JEHANZAIB WAHLAH, MEMBER JUDICIAL-III .----Through this order , I intend to dispose off Appeal No. K- 713/2019 directed against Order-in-App eal No.1919/2019 dated 29.05.2019 passed by Collector of Customs (Appeals), Karachi by maintaining Order-in-Original No.95/2012 dated 07.05.2012 passed by Additional Collector (Adjudication), MCC of Appraisement-East, Karachi.
2. Briefly facts of the lis are that the appellant during the course of his business activity imported 21 (erroneously referred as 19) consignments of Aerated Water/Soft Drinks, upon receipt of shipping documents he transmitted Goods Declaration (GDs) with the MCC of Appraisement (East) erstwhile PaCCS under the provision of section 79(1) of the Customs Act, 1969 (Act) and Rules 433 of Sub-Chapter III of Chapter XXI of the Customs Rules, 2001 (Rules) and as per pre-requisite deposited upfront duty and taxes on the basis of declaration against those.
Consequent to which GDs were numbered as CRN(i) I-HC-1395928-29042010 (ii) I-HC-1402608-06052010 (iii) I- HC-1408518-1 1052010 (iv) I-HC-1409223-12052010 (v) I-HC-1414479- 13052010 (vi) I-HC-1416780-19052010
(vii) I-HC-1424036-26052010 (viii) I-HC-1424033-26052010 (ix) I-HC-1435338 -08052010 (x) I-HC-1746794- 1003201 1 (xi) I-HC-1747863-1 103201 1 (xii) I-HC-1747523- 110320100 (xiii) I-HC-1747847-1 103201 1 (xiv) I-HC- 1748359-1203201 1 (xv) 176761 1-2903201 1 (xvi) I-HC-1767626-2903201 1, (xvii) I-HC-1771423-3103201 1 (xviii) I- HC-1772896-0104201 1 (xix) I-HC-1772903- 0104201 1 (xx) I-HC-1778398-0504201 1 and (xxi) I-HC-1784319- 1104201 1. Upon appearance of those on their workstation, the Assessing Officers subordinates of the Deputy Collector of Customs, Group-I (respondent No.2), they instead of passing assessm ent orders under the provision of Section 80 and Rule 438 of the Act/Rules on the basis of declaration opted to get the goods examined as per the contemplation of Section 198 and Rule 435 of the Act/Rules and to proceed with after adducing their opinion for obtaining examination prior to assessment forwarded the GDs to respondent No.2, who gave his assent and referred those to the Assistant/Deputy Collector of the Terminal, who marked those to the concerned examiners of his choice in accordance with the devised criteria, who carried out the requisite physical verification and the goods were found in accordance with the declaration to the extent of all aspects, reports so prepared were uploaded in the reservoir of the GDs, on the streng th of which the appropriate authorities defined in Section 2(a) passed assessment orders against each GD and transmitted view messages for payment of additional amount of duty and taxes, worked out on the basis of the assessment orders, which appellant paid on different dates and time.
Consequent to which the inbuilt authority of the PaCCS passed clearance orders in terms of section 83 and Rule 442 ibid. The appellant representative thereafter after obtaining delivery orders from the respective shipping companies obtained deliveries of the consignments from the terminal after payment of their charges. After considerable lapse of time the Deputy Director , Directorate General of Post Clearance Audit (DGPCA) issued an audit observation to the appellant stating inter alia that appellants have obtained clearance of the goods namely aerated water under PCT Headings 2202.9000 as against actual 2202.1010 and 2201.1020, on which Federal Excise Duty (FED) on retail price of the goods is leviable Q of 12% under Table I of the First Schedule of the Federal Excise Act, 2005 (FEA). This resulted in short payment of Rs.3,333,829/- FED, Rs.1,237,387/- Sales Tax and Rs.424,378/-. Income Tax and is violation of Section 32(1) & (2) of the Custo ms Act, 1969 (Act) and section 3(1)(b) and Section 12(3) of FEA, Section 36 of the Sales Tax Act, 1990 (STA) and Section 148 of the Income Tax Ordinance, 2001 (ITO). Hence, FED is recoverable under section 14 together with default surcharge in terms of section 8 and penalty under Section 19 of FEA, Sales Tax along with default surcharge under Section 34 and penalty under section 33(5) of the STA and Income Tax under Section 148 of the ITO and imposed penalty for the violation of Section 32(1)(2) under Section 156(1) and (14) of the Act. Which was replied with the submission that the respondent No..1 has no power to conduct audit under section 26(2) unless compliance to the provision of Section 26A of the Act is made and he in the capacity of Deputy Director of PCA cannot conduct audit under Section 46 of the FEA, 2005, Section 177 of the Income Tax Ordinance, 2001 and Section 25 of the STA by virtue of non appointment of "Officer of Inland Revenue" under section 29 of the FEA, Section 228 of the ITO. Beside have no power to reopen an order under the provision of Section 195 of the Act, rendering his act without power/jurisdiction. Instead of withdrawin g audit observation, the respondent No.1 framed contravention report C.No.PCA/2271/201 1/Audit/2183 dated 16.07.201 1 and forwarded the same through covering letter of even date to Collector of Customs, erstwhile PaCCS, who marked that to respondent No.3 who on the strength of which issued show-cause notice dated 13.01.2012 containing the same facts and contravening provisions and so the penal clauses of the Act, FEA, STA and ITO without even slightest change of comma and full stop. Subsequently he passed order-in-original dated 07.05.201 2 in the case of Messrs BiNees Bano, M-272, Jillani Centre, Mezzanine Floor , M.W. Tower , Karachi which was mutatis mutandi applied on the case of the appellant and he was ordered to pay the short paid amount of Rs.4995,594/- along with imposed penalty of Rs.2,500,000/-. Para 7 of the order is relevant, which is reproduced here-in-under: "7. This order also applies, mutatis mutandis to following identical case, in which the importer did not submit any defense despite provisions various opportunities the amount of duty and taxes to be recovered along with penalty imposed is as under;"
S.No.Trader Name, and AddressAtraaunt Recoverable Duty and T axes (Rs.)Penalty (Rs.) Messrs Adnan Amin FED Rs.3,333,829.00Rs,2,500,000.00 (Bronx International) (NTN-1246056), 0-401,Sales Tax Rs.1,237,387.00 Al-Habib Apartment, Block-8, Clifton, Karachi.Income Tax Rs.424,378.00 MCC/SCN/-29/0/A/2271Total: Rs.4,995,594.00 / Aerated Water Adnan Amin/ADC-ADI/PaCCS / 2012, dated 13-01- 2012.
3. Being aggrieved an appeal was preferred before respondent No.4 on 22.5.2012, against which no hearing memo. was forwarded to the appellant despite lapse of considerable time, which resulted in ordering attachment of moveable properties in addition to appellant accounts with the Messrs Al-Habib Bank Ltd, Karachi for recovery , which constraint the appellant to file Constitution Petition bearing No.D-71 12 of 2016 with the High Court of Sindh, wherein the respondent No. 4 took the plea that he has returned the appeal to the appellant advocate through covering letter dated 28.06.2012 on the pretext that the same was not accompanied with fee challan of Rs.1000/- in support of which he annexed certain photocopies of the diary sheets of its. The Hon'ble High Court of Sindh refused to buy the said arguments of respondent No. 4 and passed order dated 26.03.2019, relevant paras of Which are reproduced here-in-under:
3. We have heard the learned counsel for the parties, perused the record with their assistance and have also gone through the judgments relied by the learned Counsel for the petitioner . It will be advantageous to reproduce the relevant finding as recorded in para. 5 of the aforesaid judgment:- "5. We have heard the learned counsel for the parties, perused the impugned order passed by the Customs Appellate Tribunal and examined the case record, which reflects that. the appeal filed by the appellant before the Customs Appellate Tribunal was deficient to the extent that the applicant could not filed the certified copy of Order - in-Original along with memo. of appeal, however , record shows no objection was raised by the Registrar while accepting such memo. of appeal nor it appears that any opportunity was given to the applicant by the Customs Appellate Tribunal at the time of hearing the appeal to make out such deficiency , whereas, the appeal filed by the applicant has been dismissed on this account alone. It will be relevant to refer to provision of clause (d) of sub-rule
(3) of Rule 5 of Customs, Excise and Sales Tax Appellate. Tribunal (Procedure)/Rules, 2006 which read as follows- -- '5(3)
(d) to point out defect in such appeals and applications to the appellant or applica nts requiring them to rectify , the mistake by affording them a week's time and, if the defect are not rectified within the giving time to obtain the order of the Bench for the return of the Bench for the return of the appeals or applications, as the case may be to the appellant or applicants'.
Above rules clearly requires the Registrar Appellate Tribunal to point out the defect and allow the appellant to rectify , the same, however , in the instant case, no such exercise has been under taken by the office of the Registrar . It will be equally relevant to refer to provision of Rule 12(3) which read as follows:- `12(3) The Tribunal may keeping in view the circumstances of the appeal, accept a memorandum of appeal , which is not accompanied by all or any of the documents referred to in these Rules. '
Above Rules clearly provides that Appellate Tribunal have the authority to accept the memorandum of appeal, which is not accompanied by all or any of the documents referred to in these rules, however , it appears that Customs Appellant Tribunal by ignoring such authority vested in it in terms of above Rule, has dismissed the appeal in, a cursory manner without assigning any reason as to why such discr etion could not be exercised in favour of the applicant. More particularly , when the appeal was filed in time and was also accompanied with all the relevant documents, except the certified copy of the Order-in-Original. It further appears that the applicant have not been given an opportunity to explain his position and to make out such deficiency , on the contrary , appeal has been dismissed on this account alone, instead of being disposed off on merits. In view of here-in-above facts and the circumstances of the case, the impugned order is here-by set aside and the matter is remanded back to the Customs Appellate Tribunal to decide the appeal of the applicant on merit after providing opportunity of being heard. It may be clarified that the aforesa id appeal shall stand restored, and shall be decided preferably within a period of two months from the date of receipt of this order .
4. Keeping in view the ratio of above cited judgment and while examining the facts and circumstances of the instant case, it appears that the petitioner has discharged the burden of proof to show that an appeal was filed on 22.05.2012 under acknowledgment before the Collector of Customs, (Appeals) against Order-in-Original, along with its annexures as shown in the index. Whereas, no objection was raised from the office of the Collector of Appeals regarding any deficiency or short documents respondent have not been able to show that such appeal was returned to the petitioner vide letter dated 22.06.2012, as nothing has been produced by the respondents to show that such letter was ever served upon the petitioner . The office copy of letter dated 28.06.2012 filed along with comments does not contained any acknowledgement of receipt by the petitioner or his counsel nor there is any endorsement on the dispatched register to this effect, which could support the version of respondents relating to the return of appeal to the petitioner . Moreover , we are of the considered opinion that in case of any deficiency of documents relating to appeal filed before the Collector of Customs (Appeals), the same could have been pointed out on the same date, when such appeal was being presented in the office of the Collector of Customs, (Appeals), or could have pointed out at a subsequent stage, within a reasonable time, however , before expiry of such period as may be available to the appellant, so that such deficiency if any could be remo ved within the stipulated period, instead of returning the appeal to the petitioner . In the afore cited case, this court has examined this aspect of the matter , and has decided that an opportunity , should had been provided to make out the deficiency , if any and the appeal should had been decided on merits. Accordingly , we hold that under the above facts and circumstances of the instant case, the appeal of the petitio ner is still pending before the Collector of Customs, (Appeals), whereas, attachment proceedings initiated by the Customs Authority without providing opportunity of being heard to the petitioner or without deciding the appeal of the petitioner on merit are without lawful authority , therefore the attachment notices issue to the petitioner are hereby set aside.
5. Collector of Customs (Appeals), Karachi, is directed to decide the appeal of the petitioner on merit after providing opportunity of being heard to the petitioner preferably within the period of two months from the receipt of this order , which shall be communicated by the petitioner to the Collector of Customs, (Appeals) within 07 days. However , if the record of appeal is not available in the office of Collector of Customs, (Appeals ), Karachi, petitioner is directed to supply the requisite memo of appeal along with annexures to the Collector of Customs, (Appeals), Karachi within seven days, where after, appeal of the petitioner shall be decided on merits. However , after providing opportunity of being heard to both the parties, however , till decision either on the stay applicatio n or in the main appeal, which ever is earlier , respondents shall not enforce recovery of the impugned demand subject matter of appeal before Collector of Customs (Appeals).
4. The appellant advocate in compliance with the order of the Hon'ble High Court of Sindh, supplied photocopy of the appeal dated 22.05.2012 to the respondent No.4 through covering letter dated 28.06.2012. Thereafter , respondent No.4 conducted hearings on multiple occasions, the advocate of the appellant in addition to the arguments incorporated in the memo. of appeal, also informed respondent No.4 that all identical cases of other importer have been decided by the Customs Appellate Tribunal reported at as 2019 PTD (Trib.) 615 with the exception of the subject appeal. Hence, order in the present appeal has to be passed on the same footing. To the contrary , the respondent No.4 after lapse of 07 years from the date of the receipt of the appeal, on the order of the Hon'ble High Court of Sindh passed order dated 29.05.2019 through which he rejected the appeal on the basis of his predetermined formed opinion, while keeping aside the valid and legal objections of powers/jurisdiction and order of the Tribunal in identical cases, which is holding field firmly . Paras 5 and 6 of the order are relevant, which read as: "5 I have examined the case record and arguments of both the sides and have given careful consideration to the facts of the case. The perusal of the Customs Tariff's heading 2202.1000 and 2202.9000 shows that the "aerated water/Drinks" are rightly classified in heading 2202.1010 which also attracts FED @ 12% Hence, audit has rightly observed that the Goods Declaration should be amended to the extent of PCT, thereby generating recovery of extra amount."
"6 The appellant has mainly focused on pleading that the Directorate of Post Clearance Audit (Customs Officer) has no jurisdiction in this case as they are not designated as "Inland Revenue Officer" under the relevant provision of FEA, STA and Income Tax Ordinance, 2001. This issue has already been discussed and settled by Hon'ble Appellate Tribunal vide Customs Appeal No.K-928/2013, wherein the Hon'ble Tribunal has opined that the relevant provision of these Acts provide that duty and taxes in respect of goods imported into Pakistan shall be levied and collected in the same manner and at the same time as if it were a duty of customs payable under the Customs Act, 1969. Furthermore, on a reference from FBR, Ministry of Law, Justice and Human Rights has also opined that, "in terms of Section 7 read with Section 3(2) of Federal Excise Act, 2005. The Officer of Customs to take cognizance of any short paid amount of FED pertaining to import stage and to adjust /recover the same." In view of above, the appeal has no merit and is dismissed."
5. The appellant filed the present appeal on the basis of grounds enumerated therein, the consultant/advocates on the date of hearing argued the case strictl y in accordance with those and placed host of judgments in support of his stance. No cross objection under Section 194A(4) of the Act has been filed within the stipulated period of 30 days by the respondent No.1, which is tantamount to admission and deposition made by and on behalf of the appellant in the memo. of appeal and affidavit are therefore, deems to be true and correct and no controversy is left behind in regards to the fact of the case. Non submission of counter affidavit whether by will or default forfeit the respondent No.1 right to deny assertion made in the affidavit. This proposition of law stands validated from the following judgments of the Superior Judicial Fora reported as (1974) 94 ITR-I, 1980 PLC (C. S.) 350, 1982 PLC (C.S.) 757, 1986 CLC 745 KAR. (1984) 146 ITR 140, (1985) 53 Taxation-1 (Trib.) 1986 CLC 1119, 1986 CLC 1408 KAR, AIR 1991 MLD 1243 , PLD 1992 SC 317, 1993 SCMR 662, PLD 1996 Karachi 68, 1986 PLC (C.S.) 560 and 2003 PTD 2118. Similarly , respondent No.2 also has not filed any cross objections within stipulated period of 30 days or even till the date of hearing. However , on the date of hearing representatives of the respondents supported the orders passed by respondents Nos.3 and 4 being correct in fact and law and be maintained.
6. Heard and case record perused and the relied upon documents/judgments by the appellant's. Prior to dilating upon other factual and legal aspect of the case, it is noted that no online procedure for conducting audit under the provision of Section 26(2) and Section 155M of the Act of the consignment cleared through CCS (erstwhile PaCCS) through Rules as contemplated in Section 26A(1) ibid. in the framed Rules, incorporated in Chapter XXI of Rules.
Resultant, any audit desired to be conducted should and ought to be as per the enunciation made in Chapter XVIA inserted in the Act with the caption reading as "Provision relating to the Customs Computerized System and Audit and access to documents" . Section 155M(1) expresses that a notice in writing to be served on the importer . The emphasis is in writing, which means that it should be in writing, section 26A further validate the said mechanism of conducting audit under section 26(2), verbatim of which is reproduced here-in-under: 26A. Conducting the Audit:- (1) the appropriate officer of Customs conducting any audit under this Act shall proceed in the manner as the Board may by rules prescribe.
(2) Where any audit or inquiry or investigation is to be conducted for the purpose of ascertaining the correctness of any declaration or documents or statement, for determining the liability of any declaration or document or statement, for determining the liability of any person for duty, taxes fees surcharge fines and penalties, or for ensuring compliance with all other laws administered by the Customs, an appropriate of ficer of Customs may;-
(a) Examine, or cause to be examined upon reasonable notice, any record or any statement or declaration or document described in the notice with reasonable specificity , which may be relevant to such audit, inquiry or investigation:
(b) Summon, by giving a notice and reasonable time,-
(c) The person who imported, or exported or transported or stored or held under customs bond, or file the goods declaration, drawback or refund claim,
(d) Any of ficer, employee or agent of any person described in clause (a); and
(e) Any person having possession custod y or care of records and documents required to be kept under the Act and any other person , as deemed proper , to appear before him at a reasonable time and to produce such records and documents as specified in.
From bare reading of the provision of Section 26A 'of the Act, it is abundantly clear that the appropriate designated Officer of Customs empowered by the Board, which are officials of Directorate General of PCA /respondent No.1 for conducting audit of the record of the importer under Section 26(2) is in the manner prescribed by the Board in Rules. Since, no rules to this date are framed /issued by the Board despite insertion of Section 26A in the Act through Finance Act, 2006, resultant, the audit of an importer accounts/record maintained by him under the provision of Section 211 and Chapter XI of Act/Rules, has to be conducted by the Officials of Directorate of Post Clearance Audit or respondent No.1 as per the mechanism provided in the Section itself, wherein appropriate officer of Customs is empowered to conduct audit or inquiry or investigation of an importer for the purpose of ascertaining the correctness of any declaration or documents or statement, for determining the liability of any declaration or document or statement, for determining the liability of any person for duty, taxes, fees, surcharge, fines and penalties, or for ensuring compliance with all other laws. However , prior to proceeding with the said exercise, the appropriate officer appointed under Section 3DD of the Act for the said purpose and empowered through SRO 500(I)/2009 dated 13.06.2009. Respondent No.1 has to either summon or give a notice and reasonable time to an importer for the conduction of audit and for the said purpose production of accounts and record as per the expression of Clause (b) of subsection (2) of Section 26A of the Act. The first ground taken by the appellant in memo of appeal is that the respondent No.1 has not either issued any notice or served summon to/upon him for the purported exercise of audit despite mandated under law. This lapse renders the audit so conducted which is the root cause of the impugned show-cause notice as of no legal effect. Since, no notice is annexed with the memo of appeal, the representative of respondent No.1 was asked to place the copy of the notice/summon, forwarded/served to the appellant, as the copy of the same would had been available with him in the case file. The query was replied in negative, which flabbergasted me and another query was put to him that how the audit was conducted, without asking for the accounts and record of the import, the answer was on the basis of GD's available in the data reservoir maintained by PRAL under Section 155G and Rule 110 of the Act/Rules, upon this the representative of respondent No.1 was asked to read out the passage available in Section 26A, wherein audit of any importer is perm itted on the basis of the record available in the CCS Module, to this the answer was given in negative, confirming that audit of the importer accounts/book could only be conducted upon presentation of those after receiving notice/summon to do so. In the absence of that conduction of audit on the basis of the record available on the CCS Reservoir is not permitted as it is settle d proposition of law that a thing has to be done as it has been prescribed to be done, in case of doing the same in any other manner render it illegal B and as such void and ab-initio and this have been held in countless reported judgments, reference is 2002 PTD 2457 that "the thing should be done as they are required to be done, or not at all". The apex Court held in judgment PLD 1971 Supreme Court 61 "neglect of plane requirement of an absolute statutory enactment prescribing how something is to be done, would invalidate thing being done in some other manner" and in PLD 1973 Supreme Court 236 "it is now well established that where an inferior Tribunal or Court has acted wholly without jurisdiction or taken any action "beyond the sphere allotted to the Tribunal by law and therefore outside the area within which to law recognizes a privilege to err" then such action amounts to a "usurpation of power warranted by law" and as such an act is a nullity that is to say the result of a purported exercise of authority which has no legal effect whatsoever" in such a case, it is well established that a Superior Court is not bound to give effect to it. "The said ratio was maintained, in the case of E.A Avans reported as PLD 1964 SC 536 "where it has been unambiguously and categorically held that if the doing of a thing is made lawful in a manner than doing of that thing in conflict with the manner prescribed will be unlawful." The Hon'ble Apex Court in 2001 SCMR 838 and 2003 SCMR 1505 held that "while considering the impact of violation or non-observance of the method prescribed by law for doing an act in a particular manner or mode, such provision of law is to be followed in letter and spirit and achieving or attaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted. The same observation has been made by the Hon'ble Supreme Court of Pakistan in the Civil Petition filed by Director General of Intelligence and Investigation and others v. Messrs Al-Fait Industries (Pvt.) Ltd. and others reported as 2006 SCMR 129 "if the law had prescribed method for doing of a thing in a particular manner , such provision of law is to be followed in letter and spirit and achieving or attaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted." The super structure built on such foundation namely audit observation, show-cause notice and order-in-original no matter how strong those may be have to fall, reference is made to PLD 1996 Karachi 68 which laid down that "where the initial order or notice was void all subsequent preceding, orders or super structure built on it were also void. In reported judgment 2006 PTD 978 it is held that "the entire proceeding initiated by the Adjudicating authority and further super structure thereon including the order passed by the learned Tribunal are without jurisdiction void and in-operative." The Apex Court in PLD 1971 Supreme court 184 held that "order of a Tribunal found to be without jurisdiction ---all successive orders based upon it illegal and liable to be quashed".
7. Irrespective of the above illegality , the basic fundamental question for consideration in the present case is the power and jurisdiction of an officer with the designation of 'Inland Revenue Officer', particularly in context of the conduction of audit/adjudication of the case under Sections 42B and 4 of the FEA, Sections 25, 36 of the STA and Sections 177 and 162(1) of the ITO. The relevant provisions for determining the powers, jurisdiction and function of an officer are inter alia, sections 29 and 30 of the FEA, Sections 30, 31 and 32 of STA and Sections 207, 208 and 209 of the ITO. Section 29 of FEA, 30 of STA and 207 of ITO empowers the Board to appoint in relation to an area, person or class of persons as officer of Inland Revenue having specific designation. Section 2(12) of the FEA, 2(18) of STA and Section 38A of the ITO define the expression of 'Officer of Inland Revenue' as an officer appointed under Section 29 of FEA, section 30 of the STA and Section 207 of the ITO. The said definitions are exhaustive and unambiguously shows that the expression in itself is not a specific officer but refer to all the officers appointed under section 29 of FEA, Section 30 of the STA and Section 207 of the ITO. The appointment is therefore, made on the basis of specific designation of an officer. Clauses (a) and (k) 29 of FEA, Clauses (a) to (j)
Section 30 of the STA and Clauses (a) to (1) Section 207 of the ITO of. subsections (1) of Section 29 of FEA, Section 30 of the STA and Section 207 of the ITO explicitly enumerates that various designations of Officer of Inland Revenue, clause (k) of FEA, Clause (j) of STA, the Board appointed its different organ as Officer of Inland Revenue, Clause (j) of subsection (1) of Section 30 of STA provides that the Board may appoint an officer of Inland Revenue with any other designation. Each officer has to have a specific designation and empowered to exercise powers under the various provisions of FEA, STA and ITO. The expression of 'Officer of Inland Revenue' is therefore a general expression of phrase for all the officers having specific designation and empowered to exercise powers under the provision of the Section 29 of FEA, Section 30 of the ST A and Section 207 of the IT O.
8. In the instant case the respondent No.1 conducted audit of the FED and income tax to be collected/paid at import stage by the Clearance Collectorate/appellant as per the contemplation of Section 3 of FEA, Section 6 of STA and Section 148 of the ITO. In the absence of availability of jurisdiction under Section 29 of FEA and Section 228 of ITO, 2001 neither he or any other officers of DGPCA have not been appointed as Officer of Inland Revenue under the aforesaid sections of FEA, 2005 and ITO, instead Officers of Directorate General of Internal Audit have been appointed as an officer of Inland Revenue under Section 29(2) (b) of FEA and Section 228 of the ITO.
Notwithstanding, the representative of respondent No.1 relied upon SRO 165(1)/201 1 dated 03.03.201 1, through which Board itself appointed the officers of Post Clearance Audit as Officer of Inland Revenue and delegated powers under the different Sections of FEA under Section 29 of the FEA and Sectio n 228 of ITO. In my opinion it is for the legislature to appoint the Officers of Directorate General of Post Clearance Audit through money bill as an officer of Inland Revenue under clause (b) of Section 29 (2) of FEA and Section 228 of ITO as have been appointed different organ of the Board under subsection (2). Under subsection (3) Board or the Chief Commissioner with the approval of the Board are empowered by name or designation to appoint any Additional Commissioner or Deputy Commissioner Inland Revenue to exercise any of the powers of a Commissioner or any Deputy Commissioner Inland Revenue or Assistant Commissioner Inland Revenue to exercise any of the powers of Additional Commissioner of Inland Revenue, any Assistant Commissioner of Inland Revenue exercise any of the powers of a Deputy Commissioner Inland Revenue and any other Officer of Inland Revenue to exercise any of the power of Commissioner Inland Revenue, Additional Commissioner Inland Revenue or Assistant Commissioner of Inland Revenue under FEA and Rules made there under . The emphasis laid in the said sub section is that the officer must be an Officer of Inland Revenue of either of the designation given therein. When the Officers of DGPCA including the respondent No.1 are not appointed as Officer of Inland Revenue through a money bill under clause (b) of Section 29(2) of FEA, Board has no mandate to delegate powers to them under different section of FEA through notification in exercise of the powers conferred upon it through Clause (12) of Section 2 of FEA being in conflict with the statute, which has to prevail on the subordinate legislation, resultant, SRO No.165(I)/201 1 dated 03.03.201 1 issued by the Board is without lawful authority and jurisdiction and as such invalid and not enforceable under law being ultra virus to the provision of Section 29 of Federal Excise Act, 2005 as held in 2000 PTD 399 Superior Textile Mills Ltd. v. FOP, PLD 2001 SC 600 the Collector of Sales Tax and others v. Superior Textile Mills Ltd. and others , 2012 PTD 302 Saleem Raza v. FOP and others and 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 and an officer of Inland Revenue, powers under the different subsection of the STA can not be delegated through any SRO with that the Hon'ble High Court of Sindh declared Notification No.775(1)/201 1 ultra vires to the STA". Therefore, neither any officer of DGPCA nor respondent No. 1 are empowered to conduct audit in the matter of Federal Excise and Income Tax under Section 42B of FED and Income Tax without powers/jurisdiction, hence void and ab-initio and as such coram non judice .
9. The officer of DGPCA have indeed been appointed by the legislature as an officer of Inland Revenue under Section 30DD of the STA and have been delegated powers under different Sections of the STA under Section 31 through SRO-42(I)/2010 dated 23.01.2010 for conducting audit of the paid/collecte d or unpaid/deposited Sales Tax at import stage in the capacity of design ation specified in Column 3 of SRO, which are (i) Chief Commissioner / Commissioner Inland Revenue (ii) Additional Commissioner of Inland Revenue (ii) Deputy Commissioner Inland Revenue and (iv) Assistant Commissioner Inland Revenue and not in the capacity or designation of (i) Director General/Director-PCA (ii) Additional Director-PCA (iii) Deputy Director , Post Clearance Audit and (iv) Assistant Director , Post Clearance Audit. Hence, unless they wear cloak of expressed designation given in column 3 of SRO, they are not empowered to even/lay hands on the STA, what to say about of the powers under the different sections listed at column 4 of SRO. Irrespective of the said legal proposition in the instant case the entire communication including the audit observation and contravention report was prepared and served in the capacity of either Additional Director or Deputy Direc tor of Post Clearance Audit, which are non existent in column No. (3) of Notification No.42(I)/2010 dated 23.01.20 10, rendering the same without power/jurisdiction hence ab-initio void and rendered the entire proceeding right from Audit, Audit observation, contravention report as of no legal effect. Any super structure built thereupon, no matte r how strong it may be had to fall as held by Superior Judicial Fora in umpteenth reported judgments, placed on record of the case and which are squarely applicable with force in the instant case.
10. Similarly , respondent No.3 in the capacity of adjudicating authority despite being an officer of customs appointed under section 3 of the Act issued show-cause notice to the appellant while invoking provision of Section 14 of FEA, Section 36 of STA and Section 148 as against actual Section 162(1) of ITO, without going through the expressions of Section 29 of FEA, Section 30 of STA and respective Sections of ITO, wherein, any designation of Additional Collector of Customs, least exist. Confirming that he has not being appointed through a money bill by the legislature as an Officer of Inland Revenue, resultant, not been delegated with the powers under Section 29(2)(b)
FEA, Section 31 of STA and Section 207 of the ITO, resultant, not empowered to initiate any action either for short/non paid FED, Sales Tax and Income Tax under the provision of Section 14 of FEA, Section 36 of STA and Section 162(1) of IT O.
11. In order to lay the issue to its logical conclusion, it is apt for me to refer to Section 3 of the FEA, Section 6 of the STA and 148 of the ITO through which the Clearance Collectorates are empowered to collect the FED and Taxes on the imported goods as like custom duty on the value determined under Section 25 of the Act in the capacity of collecting agent. These sections least empowers the Officers of Customs including the respondent No.3 to initiate adjudication / recovery proceeding for the short collected/paid FED , Sales Tax and Income Tax either due to collusion or connivance or inadvertent, error or misconstruction. Proceeding for these type of recovery a show- cause notice has to be issued by the Officer of Inland Revenue of the specific designation as circumscribed under Section 29 of the FEA, Section 30 of STA and Section 207 of ITO, under the contravening provision of Section 14 FEA Section 36 of STA and 162(1) of the ITO. It is to be noted and understand that there is a distinction between the expression 'function' and 'power'. Functions can only be performed by a person who is already conferred with the powers and jurisdiction. Hence, it is pertinent for me to examine the definition of expressions 'powers', 'function' and 'jurisdiction' so as to explain the distinction between the said expression. The Eight Edition of Black's Law Dictionary defiance 'powers', 'function' and 'jurisdiction' as follows: "Powers. The ability to act or not act esp. a person's capacity for acting in such a manner as to correct someone else's, response 2 dominance, control, or influence over another; control over one's subordinate. The legal right or authorization to act or not to act; a person's or organization's ability to alter by an act of bill, the rights, duties liabilities, or other legal relations either of that person or of another"
"Function No.1. Activity that is appropriate to a particular business or profession < a court's function is to administer justice > . To office; duty; the occupation of an office < E presidential function > [cases: officers and public employees 1 10. C.J.S. Officers and public employees 234 -- 245]"
"Jurisdiction, No.1. A government's general powers to exercise authority over all persons and things within its territory; esp. a state's powers to create interests that will be recognized under common --law principles as valid in other states < New Jersey's jurisdiction > . [ cases : State I. CJ. S. States 2, 161 2.
A court's powers to decide a case or issue a decree < the Constitution grant of Federal -- question jurisdiction > . -- also termed (in sense 2) competent jurisdiction; (in both senses coram non judice [cases; courts 3; Federal Courts 31,
161. CX.J.S. Courts 9, 18]".
12. It is therefore, obvious from the above definition that the three expressions are distinct and separate. The powers or jurisdiction conferred on an officer of Inland Revenue precedes the performance of functions. The conferment of powers or jurisdiction is a pre-condition for the performance of function. By no stretch of imagination, the respondent No. 3 could himself assume that he has been appointed as an Officer of Inland Revenue under the provision of Section 29 and Section 30 of STA and the respective section of ITO by the legislature despite not exercise powers under the provision of Section 14 of FEA, Section 36 of STA and Section 162(1) of ITO which empowers Officer of Inland Revenue in accordance with his designation and Commissioner of Inland Revenue.
Therefore, it is my considered opinion that the Clearance Collectorates does have the authority to collect FED, Sales Tax and Income Tax at import stage in the capacity of collecting agent in terms of Section 3 FEA , Section 6 of STA Section 148 of ITO sans recovery proceeding. Clearance Collectorates are also empowered to recover escaped / short paid Custom Duty and Regulatory Duty levied on the imported goods under Section 18 of the Act in exercise of the powers conferred under Section 202 of the Act after due process of law, but have no powers in any case to adjudicate the cases of short recovery of FED, Sales Tax and Income Tax under section 14 of FEA, Section 36 of STA and Section 162(1) of ITO. They are also empowered to recover from the amount of importer lying with them the arrear of FED, Sales Tax and Income Tax only after receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under Rule 60, of Federal Excise Rules, 2005, Section 48 of STA and section 140 of the ITO of the adjudged amount through a valid adjudication order passed by the competent authority in terms of Section 14 of FEA, Section 36 of STA and Section 162(1) of ITO, rendering the adjudication proceeding initiated by respondent No.3 under the aforesaid sections of the FEA , STA and ITO is not legal, justifiable and tenable in the eyes of the law, hence coram non judice nor in consonance with the reported/unreported judgments of Superior Courts.
13. Reference to the order of the Tribunal in Customs Appeal No.K-928/2013 of the Customs Appellate Tribunal by respondent No.4 for validating jurisdiction/powers of respondent No.3 in the matter of FED, Sales Tax and Income Tax is also out of context and lend no support to the case of the respondent and so the order in appeal passed by him, even otherwise that was based on distinguishable fact and has no nexus whatsoever with the adjudication/recovery proceeding in the matter of FED, Sales Tax and Income Tax by an officer of customs under the provision of Section 29 of the FEA, Section 36 of STA and Section 162(1) of ITO. Appointment of an authority under a statute can only be made by a legislature through a money bill and delega tion of power rest on the Board.
When legislature has not appointed respo ndent No. 3 as an officer of Inland Revenue, Tribunal is no body either to appoint or delegate powers to an adjudicating authority under any statute, which neither appointed the said authority as an competent officer for the purpose of adjudication under the statute nor delegate powers Tribunal can only resolve an issue or interpret the provisions of the statute liberally , to advance cause of statute and that also in the light of the interpretation made by the Superior Judicial Fora. Hence, the opinion formed by the respondent No.4 has no warrant of law .
14. In reaching the instant irresistible decision, I have also been indebted from the judgment in the case of Khyber Tractors (Pvt.) Ltd. v. Government of Pakistan published in PLD 2005 SC 482, while observing the issue of jurisdiction. It has been observed that the question of jurisdiction is always considered to be very important and no order passed by a court or a forum having no jurisdiction, even if it is found to be correct on merits, is not sustainable. The Jurisdiction of a court lays down a foundation stone for jurisdiction or as quasi judicial functions to exercise its powers / authority and no sooner the question of jurisdiction is determined in negative. The whole edifice of such defective proceedings is bound to crumble down. It is also an elem entary principle of law that if the mandatory condition for exercising of jurisdiction by a Court, Tribunal or authorit y is not fulfilled .then the entire proceedings so followed become illegal and suffers from want of jurisdiction. Any order passed in continuation of these proceedings in built or revisions equally suffers from illegalities and are without jurisdiction. It is one of the mandatory requirement if the statute enacts with certain action shall be taken in certain manner and courts are required to do justice between the parties in accordance with the provisions of law, as the litigant who approach the court for the relief is bound to substitute with the procedure had been adopted by him in accordance with law, because it is elementary principle of law that if a particular thing is required to be done in particular manner it must be done in that manner , otherwise it shall not be done at all. In the present case, proceedings caused, created and conducted during hierarchy of the customs are without any warrant of law .
15. The delivery of the consignments by the terminal operator is being effected upon receipt of online gate out message on their user home page after passing of assessment/clearance order under the provision of Sections 80 and 83 and Rules 438 and 442 of the Act/Rules, which are pre-requisite. Orders passed by the competent authorities defined in Section 2(a) of the Act in exercise of the powers conferred upon them through SRO 371(I)/2002 dated 15.06.2002. Those orders were/are appealable order as per the contemplation of Section 193(1) of the Act, verbatim of which is reproduced here-in-under: 193 Appeals to Collector (Appeals): (1) Any person including an officer of Customs aggrieved by any decision or order passed under sections 33, 79, 80 and 179 by an officer of Customs before below the rank of Additional Collector may prefer appeal to the Collector (Appeals) within thirty days of the date of communication to him of such decision or order .
Upon perusal of GDs of the appellant, I have observed that these pertains to the period of 11.05.2010 and subsequent, against each GD valid and legal assessment/clearance orders were passed under the aforesaid provisions of the Act/Rules. Those cannot be disturbed by any authority for the purpose of preparing contravention report and adjudication proceeding. The only course available with the respondent No.1 was to challenge the said orders before the respondent No.4 under section 193 of the Act in exercise of the powers delegated upon him through Notification 500(1)/2009 dated 13.06.2009. In the filed appeal the respondent No.1 is empowered to incorporate all the apprehension, misreading of the facts and contravention of the provision of the Act/Rules. The respondent No.4, upon receipt of the appeal and going through the facts and grounds if thinks fit that the contention of the respondent No.1 seems to be correct and the duty and taxes have not been either not levied or short paid.
He is empowered to issue show-cause notice to the importer (appellant) as expressed in 3rd proviso to the section 193A(3) of the Act. Instead of the adherin g the prescribed method available in the Act, the respondents Nos.1 and 3 reopened the assessment / clearance orders under section 195 of the Act in the absence of availability of power as the power vested therein are for either Board or Collector . None of the respondent figure anywhere, rendering the show-cause notice without power/jurisdiction and as such ab-initio void, the superstructure built thereupon as well ab-initio void. Additionally , it is to be noted when the right of appeal has been accorded by the legislature in the provision of Section 193 of the Act, the provision of Section 195 is un-operational and cannot be exercised 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 passe d by an officer of customs below the rank of additional collector could prefer an appeal before the Collector (Appeal) ---- 1st 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." and the High Court of Balochistan in 2019 PTD 1712 titled as Collector of Customs, MCC, Quetta v. Al-Habib Enterprises and Engineering and others , while dismissing the SCRA of the department held that "after assessment of leviable duty and taxes under Section 80 of Customs Act, 1969 and payment thereof and after clearing the vehicle under Section 83 Customs Act, 1969, the available remedy of filing appeal under Section 193 of the Customs Act, 1969 was not availed by the concerned officials of the Collectorate of Customs, Additional Collector of Customs, (Adjudication) had no jurisdiction under the provision of Customs Act, 1969 to issue show-cause notice and to pass order -in-original. No question of law having arisen out of the impugned of the judgment passed by Appellate Tribunal warranting interference by High Court under Section 196, Customs Act, 1969. Reference were dismissed in circumstances ." It is also settled proposition of law that in the presence of an appealable order , fresh order cannot be passed even through issuance of show-cause notice under section 180, while exercising powers under the provision of Section 179 ibid. The said act is piling upon yet another order on the existing appealable order not permitted under law as held by 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 due to non filing of appeal within the stipulated period of 30 days, the same cannot be subject to a show-cause notice due to limitation and the transaction stood passed and closed and cannot be disturbed. For reaching at the decision I have gained strength from the 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 suo motu revision. Notwithstanding, the act of issuance of show-cause notice and passing of order-in-original in the instant case by the respondent No.3 also falls under the ambit of "double jeopardy" not permitted under Article 13 of the Constitution of Islamic Republic of Pakistan. Rendering the orders passed by respondents Nos.3 and 4 for piling upon an existing appealable order are without lawful authority and jurisdiction and as such void and ab-initio and of no legal ef fect.
16. I have noted with concern that the respondent No.1 implicated and the respondent No. 3 charged appellant for mis-declaration under the provision of Section 32 of the Act merely on the basis of assumption/presumption that the appellant transmitted GDs on the basis of eroneous PCT, in order to hoodwink the Customs and to, evade the amount of FED and taxes. I am at loss to digest the said line of arguments as in conduction of examination appellant has no part to play, instead had to be carried out by the subordinat e of respondent No.2 with the assistance of Officials of Terminal Operator , independently and without any influence as per the expression of Section 198 and Rule 435 ibid. Whereas, passing of assessment/clearance orders under sections 80 and 83 and Rules 438 and 442 of the Act/Rules rest with the sole and exclusive domain of the Customs Officer listed at Serials Nos. 30 and 33 of the SRO 371(I)/2002 dated 15.06.2002. The Officials conducting the examination confirmed the declarations and assessing officers passed assessment / clearance orders while accepting the declaration as true and correct. If it is presumed as stated in the show cause notice that the alleged clearance of the goods imported by appellants were on the basis of errone ous description and PCT, that could had not been possible unless these officials were having hands in gloves with the appellants. Meaning thereby that they are standing on the same pedestal with the appellant. Ironically , no charges have been levelled under Section 32(2) against those Officials, as of appellant, confirming that the case in question is of inadvertence, error, omission or misconstruction falling within the ambit of Section 32(3) of the Act, the appropriate authority to adjudicate such type of cases rest with the Principal Appraiser in terms of Clause (ii) of Serial No.3 of SRO 371(I)/2002 dated 15.06.2002, not respondent No.3 rendering the show-cause notices and order-in-original without power / jurisdiction hence, ab-initio void and as such coram non judice . Additionally , it has been established that the appellant has been met out with partial treatment, which is tantamount to discrimi nation not permitted under Articles 4 and 25 of the Constitution of Islamic.
Republic of Pakistan and the law laid down by the Superior Judicial Fora in reported judgment 2002 SCMR 312 and 2009 PTD 1507 the Hon'ble Superior Courts have observed that "there exists no power to target incidence of tax in such a way that similarly placed person be dealt not only this similarly , but discriminatingly". Whereas, in reported judgment 2005 SCMR 492 the Hon'ble Supreme Court held that "A facility allowed to someone and denied to other is discrimination". The apex Court further held in reported judgment 2010 SCMR 431 that: "Doctrine of equality , as contained in Art. 25 of the Constitution, enshrine golden rules of Islam and states that every citizen, no matter how high so ever, must be accorded equal treatment with similarly situated persons--- State may classify persons and objects for the purpose of legislation and make laws applicable only to persons or objects within a class---In fact all legislations involve some kind of classification whereby some people acquire rights or suffer disabilities whereas others do not---What however , is prohibited under principle of reasonable classification, is legislation favouring some within a class and unduly burdening others--- Basic rule for exercise of such discretion and reasonable classification is that all persons placed in similar circumstances must be treated alike and reasonable classification must be based on reasonable grounds in given set of circumstances but the same in any case must not offend spirit of Art. 25 of the Constitution."
17. Notwithstanding, for resolving the issue in hand, I have scrupulously gone through the contents of show-cause notices and the grounds taken by the appellant and has observed that the allegations levelled by the respondent No.3 in the show-cause notice is of general nature and for that reason in support of those no intangible incriminating evidence such as posted examination reports, copies of images, which were vital in such type of cases were annexed with the show-cau se notice or even placed on the record of the Tribunal on the date of hearing. Nevertheless for further confirmation of the charges, the representative of the respondent No.1 was asked that what is the basis for forming the said opinion, the reply was that the images posted with the examination report, although confirmed the declaration of the goods i.e. "Assorted Soft Drink ", which are notified in the First Schedule to the Act as Aerated Water under PCT heading 2202.1020. Upon this representative was confronted with the query that whether these images were available with the Assessing Officers who passed the assessment orders after examining those, reply was in affirmative. Consequently , respondents representatives were asked that as to whether determination of PCT/Class ification of those does rest with the Customs Officers in terms of Section 80(1) and Rule 438 of the Act/Rules, which read as "Section 80 Checking of goods decla ration by the Customs----(1) on the receipt of goods declaration under section 79, an officer of customs shall satisfy himself regarding the correctness of the particulars of imports, including declaration assessment, and in case of the customs computerized system payment of duty, taxes and other charges thereon." and "Rule 438-- Assessment by Customs Authorities . Where any declaration has been filed under Rule 433 or additional documents have been submitted under Rule 437 the Customs shall satisfied itself as to their correctness including its value, classification claim of exemption, payment of duty and taxes and may re-assess the goods during or after clearance". The reply was in affirmative. This amazed me but to further crystallize the issue the representatives were asked to read out the declared description of the goods to which the description was read out as "Assorted Soft Drink", and thus were asked that the imported goods were aerated water or not the reply was aerated water .
This confirmed that the appellant has not made any mis-declaration in material particular and determination of the actual description of the goods and classification of those rest upon the Custom Officer, there least exist an iota of evidence that the appellant influenced either the examiner or assessing officer for not determining the correct PCT heading on the basis of examination reports and uploaded images. In the given circumstances of the case, the entire fault of not assessing the goods under correct PCT rest with the Customs Officials. Resultant, respondents Nos.1 and 3 failed miserably to prove charges in terms of Articles 117 and 121 of Qanun-e-Shahadat that the appellant declaration was false in material particular and attracted the mischief of Sections 32(1), 32(2) and 32(3A) of the Act.
18. It is to be noted that each and every importer is duty bound to file returns-cum-payment challan of FED and Sales Tax duty as per the contemplation of Section 4 of FEA and Section 26 of STA , in those, he is entitled to'claim input of the paid duty and taxes either at import stage or local buying, from which after making adjustment of the output tax charged by him from the buyer of the sale goods, in case input duty and taxes are excess, either he claims refund for that or carry forward for adjustment in the returns of next month as expressed in Section 6 of FEA, Section 7 of STA, vice versa if the output duty and taxes are excess to the paid input tax, he deposit the difference of tax with the prescribed branch of the National Bank of Pakistan. Similarly, for paid income tax levied on the imported goods, an importer files an annual statement with the FBR in terms of Section 115(4) of the ITO as final tax liability for the tax year. In the presence of availability of the said mechanism, it is mandated upon the Officers of Customs to levy/collect duty and tans correctly in accordance with the provisions of the FEA, STA and ITO or infield notification on the imported goods, enabling the importers to declare the same in his monthly returns of FED, Sales Tax and Income Tax and annual statement of Income Tax as he has to charge/pass on the same from the buyer (end consumer) at the time of selling the goods if duty and taxes are not levied / collected by the Customs officials correctly due to inadve rtence, error or misconception, those cannot be recovered subsequently through any mechanism e.g. through show-cause notice/order-in-original, as against the said short collected / paid amount of duty and taxes, importer is unable to show the same as input tax, nor output in his monthly return for duty and taxes after sale of the goods, after taking into account the cost of the goods amount of duty and taxes and administrative/selling expenses, charging any amount subsequent to sale is neith er ethical or legal. Therefore, in the present case the provision of Section 19A has to play a crucial role, evident from my deliberation in penultimate paras, reproduction of its verbatim is vital: "19A .presumption that incident of duty has been passed on to the buyer:- Every person who had paid the custom duty and other levy or other goods under this Act shall unless the contrary is proved by him, be deemed to have passed on the full incidence of such custom duty and other levies to the buyer as part of the price of such goods."
The intention of the legislature in the said provision is that, that no person can claim refund of any duty or other levies which he paid on the goods imported and deemed to have been passed in full incidence of the paid duty/levies to the end buyer as a part of the price of such goods, unless contrary is proved by him through documentary evidence that he has not passed on the duty and levies paid at the time of clearance of the imported goods to end consumer , if he successfully proves that he has not passed on these, his claim of refund is admissible and ought to be sanctioned. The said section has to be read in conjunction of Section 33 ibid, which governs refunds arising out of error, omission and misconstruction and for that reason proviso to subsection (1) of section 33 was inserted through Finance Act, 2009. However neither section 19A nor Section 33 are applicable on the refunds which are outside the ambit of Section 33 as held in umpteenth reported judgment of the Superior Judicial Fora.
19. The question arise that when the Clearance Collectorate has not charged/levied FED and taxes due to error, omission or mis-construction, how it can collect subsequently after clearance of the goods, if the expression of Section 19A is read in juxtaposition, which should be as follows: "19A ..presumption that incident of duty has not been levied and collected from the importer and not paid by him:- Every person who had not paid the custom duty and other levies or other goods under this Act, deems to have not passed any part of the incidence of such duties and other levies to the buyer unless the contrary is proved by the customs. "
In the present case of the appellant, under judicial scrutiny of the Tribunal, it is admitted fact that the official of respondent No.2 has not charged the levies of, FED, sales tax and income tax at the time of the passing of clearance/assessment order under sectio ns 80 and 83 and Rules 438 and 442 of the Act/Rules. Levying/collected these at belated stage through adjudication proceeding is not correct being devoid from legal infirmity . The FEA, STA and ITO are silent in regards to mechanism that how the said levy can be passed on by the appellant to the end consumer being not in consonance with the essence and spirit of FED , Sales Tax and Income Tax. This approach is not correct instead nullity to law as no FED or taxes can be demanded from the appellant by virtue of the fact that he has not passed those as neither those were levied nor paid as per the essence and spirit of the provision of section 19A expressing that when a person fails to prove that he has not passed FED and taxes paid by him at import stage, it is presumed to be passed on to the end consumer in full and as such is not entitled for refund. Therefore, in principle instead of adopting the cumbersome litigation process, it would had been appropriate for the respondent No.2 to_approach the Federal Board of Revenue for issuance of notification for regularizing of non collection of FED, Sales Tax and Income Tax levied under the FEA, STA and ITO on the consignments of the appellants, while taking guidelines from Section 65 of the ST A, which read as follows: "65... Exemption of tax not levied or short levied as a result of general practic e.----Notwithstanding, anything contained in this Act, if in respect of any supply the Federal Government is satisfied that inadvertently and as a general practice .
(a) Tax has not been charged in any area or any supply which was otherwise taxable or according to the said practice the amount charged was less then the amount that should have actually been charged;
(b) The registered person did not recovered any tax prior to the date it was discovered that the supply was liable to tax; and
(c) The registered person started paying the tax from the date when it was found that the supply as chargeable to tax.
It may, by a notification in the official Gazette, direct that the tax is not levied or short levied as a result of that inadvertent practice, shall not be required to be paid for the period prior to the discovery of such inadvertent practice."
20. The provisions of Sections 193(1) and 194(1) of the Act had been amended through Finance Act, 2012, as: 193 Appeals to Collector (Appeals): (1) Any person including an officer of Customs aggrieved by any decision or order passed under sections 33, 79, 80 and 179 by an officer of Customs not below the rank of Additional Collector may prefer appeal to the Collector (Appeals) within thirty days of the date of communication to him of such decision or order .
194-A Appeals to the Appellate Tribunal (1) Any person ( or an officer of Customs) aggrieved by any of the following orders may appeal to the Appellant Tribunal against such orders > [(a) a decision or order passed by an officer of Customs not below the rank of Additional Collector under Section 179] [(ab) an order passed by the Collector (Appeals) under section 193;]
(c) an order passed under Section 193, as it stood immediately before the appointed day .
(d) an order passed by the Board or the Collector of customs under section 195 [*****] (e){an order passed in revision by the Director General Customs Valuation under section 25D, provided that such appeal shall be heard by a special bench consisting of one technical member and one judicial member .} By virtue of the above amendments, appeals filed against the order passed by Additional Collector stand ousted jurisdiction / powers of respondent No.4 w.e.f. 01.07.2012, resultant, appeals lying with him against the orders of Additional Collector had to be decided by him on or before 30.06.2012 not subsequent to that. In case of non decision by 30.06.2012, it was mandated upon him to transfer the pending appeals to Customs Appellate Tribunal, to whom jurisdiction has been assigned by the legislature under Section 194A (1) of the Act, w.e.f. 01.07.2012. To the contrary , the respondent No.4 passed order dated 20.06.2019 in the present case, which was filed with him on 22.05.2012, which has been assailed through the present appeal by the appellant before the Customs Appellate Tribunal. For nullifying the effect of provisions of Sections 193(1) and 194(1) of the Act , the representative of the respondent No.1 took the plea that respondent No.4 passed the order in compliance of the order of the High Court of Sindh dated 26.03.2019 opined that no contravention of law has been made by him. This line of arguments is without any substance, instead absurd, the Hon'ble High Court of Sindh in its order , no where either amended or extended the provision of section 193(1) or 194(1) of the Act, which otherwise, is not within the domain of Hon'ble High Court, which could only interpret the provision of the statute. The Hon'ble High Court in its order has directed to decide the case within 7 days after providing opportunity of hearing to the petitioner , this does not means to record order on merit, instead he could had passed order after providing opportunity to the appellant for the transfer of the present appeal to the Customs Appellate Tribunal, which has jurisdiction and power to decide the appeal on merit. To the contrary respondent No.4 passed order in negation of the provision of section 193(1) and in transgression of the power vested upon the Customs Appellate Tribunal under the provision of sections 194(1) and 194B(1) of the Act, which is not permitted under any circumstances. Rendering the order so passed in excess of jurisdiction and as such ab-initio, null void and as such coram non judice .
21. It is settled proposition of law that very assumption of jurisdiction by the respondent No.4 in the instant matter was against the said provision of law. It is well settled that a forum cannot take cognizance of a matter beyond its jurisdiction prescribed in the relevant law. Inherent defect cannot be cure to defeat the provision of statute or enactments effecting the jurisdiction of a forum. It is in alienable right of every citizen to have protection of law and be treated in accordance with in terms of Article 4 of Constitution of Islamic Repu blic of Pakistan, 1973. An order passed against a person by any forum against express provision of law on the subject, if allowed to be stay intact, would cause serious prejudice to the legal right of citizen. Reference can be made to Azhar Alam Farooqi Advocate v. Sheikh Abdul Sattar Lasi and others (2008 SCMR 240), Mst. Fateh Bivi and others v. Additional District Judge, Khushab and others , (2008 SCMR 1262 ), Muhammad Anwer and others v. Mst. Ilyas Begum and others (PLD 2013 SC 255) and OMV Energy v. Ocean Pakistan and others , (2015 CLC 1504 ). When a forum/ Court suffer from want of inherent jurisdiction, no act of consent or acquiescence in the proceeding can vest such from/court with such jurisdiction. No question of waiver or estopal is attracted in such circumstances. There can be no exception to the principal that the order passed or an act done by the Court or a Tribunal, in competent to entertain proceeding is without jurisdic tion. Jurisdictional defect could not be removed by mere conclusion of proceedings of passing of order-in- original and order-in-appeal. It is well settled law that when a law required and act to be done in a particular manner it had to be done in that manner alone, not otherwise. Reference in this regard can be made to Muhammad Hussain and another v. Muhammad Shafi and another (2004 SCMR 1947 ) and Munawar Hussain and 2 others v . Sultan Ahmed (2005 SCMR 1388 ).
22. The appeal before the respondent No.4 was filed on 22.05.2012 and an order under the provision of Section 193A(3) against that had to be passed by him within 120 days from the date of filing of appeal i.e. by 19.09.2012 or within a further extended period of 60 days during the initial period of 120 days with reason to be recorded for extension in writing. No extension was granted by respondent No.4 prior to expiry of initial period of 120 days i.e. by 19 09.2012. Contrary the order-in appeal had been passed by him on 29.05.201 9 i.e. after expiry of 2442 days.
For providing justification for the delay in passing the order by respondent No.4, the representative of respondent No.1 averred that the limitation provided in section 193A(3) in the present case is not attracted by virtue of the fact that respondent No.4 passed order after receipt of order of the Hon'ble High Court of Sindh and copy of appeal from the appellant. Hence, the date of appeal has to be reckoned from the date of submission of copy of appeal with the respondent No.4. The averment made by the representative has no substance, instead the Hon'ble High Court of Sindh admitted that the appeal by the appellant was filed with respondent No.4 was on 22.5.2012 and copy of the same was ordered to be supplied, no order exist for either allotting a fresh number on the date on which copy was submitted, meaning thereby that the date for all practical purposes has to be read/considered as 22.05.2012 without any exception and consequent flowing out of that has to be determined from the date of submission i.e. 22.05.2012. Therefore, I hold in unequivocal terms that the order-in-appeal passed by respondent No.4 is barred by time by 2322 days and even latches as held by the Hon'ble High Court of Sindh in CRA No.44/2007 Pakistan International Airlines, Karachi v. Additional Collector Customs, Sales Tax and Central Excise (Adjudication-II) Karachi and 02 others , that "there should come a time when the matters are considered to be finalized and put to rest and the sword hanging on the tax payer is removed , which is a universal principle and that where no limitation is provided for certain action, which impair vested rights, the courts an empowered to impose reasonable limitations for carrying out such actions. We are, therefore, of the opinion that the Adjudicating Officer cannot be rewarded for his gross negligence in sleeping over the mater for more than four years. On this point the learned counsel for the Respondents that the question does not arise from the order of the Tribunal because the Tribunal has not given finding on it. The learned Counsel for the Applicant has drawn our attention to the memo. of appeal filed by the Tribunal wherein it was specifically challenged that the order -in-Original was finalized much after the period of limitation had expired, the Reference Application was allowed and order passed by the forum below was set-aside. " Rendering the order pass by respondent No. 4 without lawful authority/jurisdiction and as such ab-initio null and void. Hence, not enforceable under law in the light of reported judgments 2008 PTD 60, 2008 PTD 578, 2009 PTD 762, 2009 PTD (Trib.) 1263, (2009 PTD 1978 ), 2010 PTD (Trib.) 1010, 2011 PTD (T rib.) 79 , 2011 PTD (T rib.) 987 , 2011 PTD (T rib.)1 146 and 2012 PTD (T rib.) 1650 .
23. Before concluding the subject case, I have given anxious consideration to the arguments of the rival parties and perused the impugned orders, the relevant provisions of law, the case law referred specifically the interpretation of law, legal propositions and observations made thereon and infield ratio decidendi observed by the Superior Courts, I, have reached to the irresistible conclusion that the appellant has been needlessly dragged into the litigation by the respondent No.1 despite not warranted under law. I hereby vacate the impugned show-cause notice, and set aside the orders passed by the respondents Nos.3 and 4 as ab-initio, null and void. Appeal is allowed with no order as to cost.
24. Judgment passed and announced accordingly .