ABDUL JABBAR QURESHI, MEMBER JUDICIAL-I. By this judgment, I intend to dispose of Customs Appeal bearing No.K.-1647/2020 filed against Order-in-Appeal No.2845/2020 dated 22.10.2020 passed by learned Collector of Customs (Appeals), Karachi.
2. Brief facts of the case as stated in the impugned order are that staff of the Pakistan Coast Guards intercepted a Hino Truck bearing Registration No.TAN-018 (TMD-886) coming from Winder side. The detailed checking of Hino Truck was carried out which resulted in recovery of Iranian Diesel hidden in secret cavity of truck. The driver of the vehicle was asked about legal documents but he could not produce the same. Thus, the 14500 liters Iranian Diesel and Hino Truck were seized under the relevant provisions of law.
3. A show-cause notice issued and matter was adjudicated. The learned Deputy Collector of Customs (Adjudication), Quetta, Camp Office, Custom House, Gaddani passed an Order-in- Original No.173/2020 dated 11.05.2020 wherein seized. Iranian Diesel 14500 liters were confiscated outright on charge of smuggled one and seized vehicle was also confiscated outright on charge of tampering and imported without payment of duty and taxes under the relevant provisions of law.
4. The appellant being aggrieved with the Order-In-Original No.173/2020 dated 11.05.2020 and filed an appeal before the learned Collector of Customs (Appeals) Karachi who passed the, an order as under: "I have examined the case record and the arguments of both the sides and have given careful consideration to the facts of the case. In view of the Forensic examination report and the facts that vehicle's chassis number is affixed by physical grinding, it is abundantly clear that the vehicle bears a tampered chassis. Therefore, there is no denying the fact that vehicle is non-duty paid and plying against fake documents. Therefore, I do not find any reason to interfere with the order.
The appeal being without merit is rejected."
5. The appellant again aggrieved with the Order-in-Appeal No.2845/2020 dated 22.10.2020 passed by the learned Collector of Customs (Appeals) Karachi filed the instant appeal before this Tribunal on the grounds that notice under Section 171 of the Customs Act, 1969 has not been served or issued to the owner of the vehicle which is mandatory requirement of law. The goods / diesel which was recovered from vehicle was loaded on rental charges by the Transport Company, it is also evident from record that there is no mark and identification of foreign origin or same specified in the show-cause notice nor any identification of the un-specified or unauthorized route has been given. The subject seizure was made only due to some misunderstandings. The evasion of duty and taxes assessed. by the seizing agency was not falls under Section 2(s) of the Customs Act, 1969. and Section 16 of the Customs Act, 1969 also not applied under the circumstances of the case because place of seizure is not border area and same was seized during transportation within the country. The detained vehicle is not liable for confiscation because same was not seized from border area. Mandatory provision of Section 103, Cr.P.C. has not been complied properly, both the mushirs were belongs to department and members of seizing party which can also be confirmed from the record of the case. Separate mushirnama of the recovery was not prepared at the time of seizure and vehicle is in the custody of Customs staff 'for more than three months. Appellant is facing hardship because said vehicle is only source of income of the Appellant. The registration documents of vehicle were verified but seizing agency refuse to release vehicle of appellant. Notice under Section 26 of the Customs Act, 1969 was not served to the claimant of the subject goods for required information to be furnished before the seizure and the seizing agency have not complied with the proper provisions of law. Reliance is placed on the judgment of Honorable High Court of Balochistan passed in Customs Appeal No.3 of 2003. It is also evident from the charter of the Show- Cause Notice that no notice under Section 26 of the Customs Act, 1969 was given to Appellant and no specific charge regarding illegality of importation were disclosed. Even if there was any suspicion of commission of illegality, details should have been provided to enable the importer to have an opportunity to produce all the documents and disclose information. Thus, if any inquiry was initiated against Appellant it was nothing but a roving inquiry only to net him for any charge to be found out of documents called. In this regard Honourable Supreme Court of Pakistan observed in the case of Assistant Director, Intelligence and Investigation v. Messrs B. R. Herman such an action was unwarranted by law. Appellant complied with the provision of Section 187 of the Customs Act, 1969 and handed over Registration book and purchase documents supplied by the transport company which was not considered nor return and it is now entirely up to the Seizing Agency to shift the burden, if they found any discrepancy or controversy in the documents. The vehicle was seized within the country, same can be confirmed from the record of the case and there is no restriction for transportation of such goods within the country and contents of show- cause notice are denied. Notice under Section 163 of the customs Act, 1969 was not served to the Appellant same can be confirmed from the record of the case because goods of the Appellant were seized within the country, hence seizure of vehicle is unlawful because the goods were legally and lawfully loaded for transportation by the Appellant and documents were submitted before the Adjudication Authorities for consideration and verification in case of doubt or any ambiguity.
6. Sections 2(s) and 16 of the Customs Act, 1969 is not applicable as per circumstances of the case.
In presence of credible information, the seizing agency should be complied with the mandatory provision of Sections 162 and 163 of the Customs Act, 1969. Section 162 of the Customs Act, empower a Magistrate to issue warrant on an application by a Gazetted Officer of the Customs under Section 163(1) not below the rank of Assistant Collector of Customs or another officer of like rank duly employed for the prevention of smuggling, if he has reason to believe that any goods liable to confiscation under the act are concealed or kept in any place and there is a danger that the same may be removed before a search, can be effected under Section 162, may after preferring a statement in writing of grounds of his belief and of goods for which search is to be made. According to the subsection (2) of Section 163 an officer is further required to leave a signed copy of aforementioned statement in accordance with mutates mutandis with the provisions of criminal procedure code if the search is without warrant will be in contravention of section 163(1).
The presence of the Magistrate cannot be said to obviate a necessities of obtaining a search warrant. The precedent cited in a case Shaukat Hussain v. Zulfiqar Ahmed and others (PLD 1981 Lahore (sic)), 1983 PCr.LJ 676, already decided by the Superior Court wherein released the seized goods. The vehicle was seized within the country same can be confirmed from record of the case and there is no any restriction for the movement of same kinds of goods within the boundary of the Country. The SRO 118/83 dated 12.12.1983 is material whereby FBR has Notified the area of five (5) miles adjacent to the frontier of Pakistan with India and Iran to the area to which section 177 of Customs Act shall apply. The bare reading of section 177 read with SRO 118/83 shows that the transportation of goods within the territorial limits of Pakistan do not constitute an offence. The origin of the seized goods had not been established through laboratory test and case was prepared on basis of presumption. In number of cases reported as PLD 1974 SC 5, PLD 1988 Lahore 177, 1991 SCMR page 1753 the Superior Court of Law had clearly held that penal action against the conveyance should not be taken unless there is clear evidence of involvement of owner in transportation of smuggled goods and place of seizure in present case is not boarder area. It is further stated that seized vehicle was not previously used nor detained nor alleged in present charges same can conformed from record and seizing agency has merely relied on false information of their market rivals and had thus illegally removed the subject consignment from the appellant vehicle terming them as smuggled goods. Since the goods were locally loaded, they did not have any import documents and the burden of proof clearly falls on the seizing agency. It is a fundamental law that all citizens are equal before the law in terms Article 25 of the Constitution of Islamic Republic of Pakistan, 1973 and to avoid discrimination. The Article 25 of Constitutions of Islamic Republic of Pakistan, 1973 says about Equality of Citizen: "All citizens are equal before the Law and are entitled to equal protection of Law."
7. Mr. Ziaullah, Naib Subedar appeared on behalf of the respondent and advanced argument in full support of the impugned order and contended the vehicle has rightly been confiscated outright and prayed that the impugned order may be maintained and appeal filed by the appellant dismissed.
8. Arguments heard and record perused. It is the settled the principle of law that under aforementioned circumstances the appellant cannot be punished without issuance of proper show-cause notice to the owner of the vehicle. As in the impugned show-cause notice and in Order-in-Original the charges were tried to establish by the respondent hypothetically, as neither such charges were served upon the appellant nor any proper show-cause notice was issued against the appellant, therefore, all actions taken by the respondents are illegal, void ab initio and of no legal consequences. It is now a well settled law, that where the initial order or notice was void, all subsequent proceedings, or superstructures build on it were also void. Where any adverse finding was given in the adjudication order on allegations or contentions or findings which are not incorporated in the show-cause notice, the entire proceedings would be rendered as void for reason of breach of natural justice, which was breach of law as held by the Supreme Court in Anisa Rehman v. P.I.A 1994 SCMR 2234". The adjudication orders cannot travel beyond the Show- Cause Notice. If the Show-Cause Notice is not served within the prescribed limitation period, then no adverse action can be taken against the Appellant. Such Show-Cause Notice which did not comply with the mandatory provisions of law is unlawful (Ciba Geigy v. Deputy Collector 2005 PTD 1182). Therefore, the defective Show-Cause Notice cannot become the basis for any action against the Appellant. The Order-in-Original is always built on the provisions of Show-Cause Notice. In the impugned case, specific Show-Cause Notice was never served upon the Appellant therefore, is defective in law. "All the superstructure built subsequently, thereupon, would also suffer from the same infirmity. Such impugned orders would be liable to be set at naught on the ground of their having been passed / recorded against the express provisions of law. (Tripple-M (Pvt.) Ltd. v.
Federation of Pakistan 2002 YLR 2792).
9. It is mandatory requirement under Section 180 of the Customs Act, 1969 that the Show-Cause Notice shall be issued for all proper, lawful and legal adjudication of any matter when there is no charge allegedly made constituted against the owner/appellant. The confiscation of the goods or imposition of penalty on any person is barred under the law. Consequently, adjudicating officer could not pass order for confiscation of the goods. It is a legal lacuna which cannot be cured at all.
In view of the pronouncements made by the august Supreme Court of Pakistan in the case of Haji Abdullah Jan and others (1994 SCMR 749) and in case of Collectors Central Excise and Land Customs v. Rahm uddin vide CPLA No.44-Q of 1986 dated 11.04.2087 (1987 SCMR 1849). It is well settled principle, of law that, if the law had 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 attaining the objectives performing or doing of a thing in a manner other than provided by law would not be permitted, same view also decided in the land mark judgment of Director, Directorate General of Intelligence and investigation and others v. Messrs Al-Faiz Industries (Pvt.) Ltd. and others reported as (2006 SCMR 129).
10. In present case when the subject vehicle was intercepted on 19.02.2020, impugned Show-Cause Notice was issued on 09.03.2020 to the driver, initially the opinion was framed on the basis under "naked information". Forensic expert report (FSL) was obtained on 03.03.2020. The contents of the Show-Cause Notice mentioned thereon are not specific in nature nor the seizing agency comply the proper provisions of law, to establish the charge against the present appellant. By doing so, the seizing agency/respondent did not discharge the burden cost on them and not shifted it on to the appellant. It is for the prosecution to establish through the independent iota of evidence that the vehicle was smuggled or brought into the country through unauthorized route or otherwise, unfortunately, the same aspect was never controverted nor any efforts were made. On the other side the appellant produced the iota of evidence along with the registration documents before the competent authority for showing the bona fide possession, this type of evidentiality as envisage to be determined where the burden of prove and disprove the allegations levelled by the customs authorities where the Customs Authorities are under no obligation to lead evidence and discharge any onus to prove.
This part of liability reflects the responsibility under section 187 of the Customs which in fact imposed the embargo on the parties to shift their burden of proof. It has been observed by the Hon'ble High Court in case reported in 2007 PTD 2265, that vague, unspecific and too general Show-Cause Notice may not enable the reader or the notified person to make out or clearly identify the particular clause / subsection or the reasons etc applicable to the case. Also Article 117 of Qanun-e-Shahadat appears to be contrary to the general principle of law whatsoever alleges must be proved. In this particular case for reasons better known to the department even having the knowledge department fail to comply with the provisions of law which are mandatory to comply with. However, on close scrutiny of the evidences available on record as well as submissions and arguments extended by both the parties, the department failed to perform the duty under such situation where it is the only initial evidence to prove the burden through documentary evidence. The appropriate officer while exercising jurisdiction under the Customs Act must properly apply his mind to the facts of the case and must consider the statutory provisions in the manner explained above, but on the contrary in this case such important statutory restrictions openly violated during the hierarchy of the customs.
11. It has also been observed that the report of FSL was insufficient to detain or seize the subject vehicle, inter alia on the ground that the same was smuggled vehicle. Record of the case creates and causes doubt specially under the circumstances when the department had not made any efforts to controvert the specifications of the FSL reports by producing any evidence of another vehicle bearing the same chassis number. On inquiry of that particular question reply on part of the respondent is not satisfactory, admittedly they had not made any effort to produce the evidence in support of the allegations allegedly raised in the show-cause notice. It would further be usefull to add that in Black Law Dictionary, the Forensic Engineer has been given the meaning of the principles and practice of engineering to the elucidation of questions before courts of law. Practice by legally qualified professional engineers who are expert in their, field, by both education and experience; who have experience in the courts and an understanding of jurisprudence. A forensic engineering engagement may require investigations, studies, evaluations, advice to counsels, reports, advisory opinions, depositions and / or testimony to assist in the resolution disputes relating to life or properly in cases before court, or other lawful tribunals. None of these requirements were properly carried out by the seizing agency during the hierarchy of Customs, nor the departmental representatives made any further efforts to meet the requirement of as mandated under Sections 2(a), 16 and clauses (8), (89) of section 156(1) of the Customs Act, 1969 and Section 178 of the Customs Act, 1969, further to say respondent deliberately mutilated the provisions of statue, this would not be permissible under any condition.
12. The principle of law that the state functionaries have no power and authority to conduct fishing and roving inquires without possessing any definite and proper information, just in hope to unveil some concealment and illegality on the part of the tax payer/citizen. Before embarking upon any inquiry citizen, the state functionary must already possess some definite material so as to establish any illegal action hiving been taken by the citizen. In this regard reference is invited to 1995 PTD
(Trib) 580. The issue came up for judicial scrutiny before the Supreme Court of Pakistan in the case of Assistant Director Intelligence and Investigation v. M/s B.R. Hermen PLD 1992 SC 485, wherein their lordships had observed that "The object of section 26 of the Customs Act, 1969 is to empower the authority to ask for information or require the production of documents or inspect the same in order to determine the legality or illegality of importation or exportation of goods which have been imported or exported, the value of such goods, the nature, amount and source of the funds or the assets with which goods were. acquired and the customs duty chargeable therein or for deciding anything incidental thereto. The authority can only for specific purposes of determining the legality or illegality call for information as required under section 26. Even in cases of suspicion of commission of illegality, details should be provided to the party to enable him to have an opportunity to produce all the relevant documents and disclose information. It is imperative to place on record that equity is the soul of the law in dispensation of justice, in the instant matter, the Appellate has furnished the substantial evidence. The Honourable Supreme Court of Pakistan in a hallmark judgment namely Imtiaz v. Ghulam Ali reported as PLD 1963 SC 382 laid down the rule that the proper place of procedure in any system of administration of justice is to help and not to thwart the grant to the people of their rights. All the technicalities have to be avoided unless it be system which by giving effect to the form not to the substance defeats substantive rights is defective to the extent. The ideal must always be a system that gives to every person what is his right under the law. The contention of the parties regarding Sections 2(s) and 16 of the Customs Act, 1969 is not applicable to, the Appellants, because Appellants had legally/lawfully provided the iota of evidence in proof of their claim thereof. Furthermore, the seized vehicle do not fall under Section 2(s) of the Customs Act, 1969 and there is nothing on record which show that documents produced are fake or non genuine. The impugned vehicle according to the report has the same chassis number and replacement not found and the specific doubts were clarified. Hence, the report of the F.S.L was sufficient evidence to observe that the subject vehicle is not tampered nor any replacement of the chassis number has been made or deciphered any other number during file hierarchy of the Customs are perverse from the evidence and based on misconceived facts. In this particular case the respondent at the time of issuance of show-cause notice without the standard of proof, mandatory provisions of law or statue has not been complied only tainted with legality and proposition of trite law which has no cavil with the allegedly imposed charge on the appellant specially when the provisions of Sections 2(s) and 16 of the Customs Act, 1969 has not been charged in terms of clauses (8) and (89) of Section 156(1) with support of any evidence and non compliance to Section 187 of the Customs Act, 1969 through show-cause notice, clearly reflects the iota of doubts and such standards which requires the implementation of law are violated by the respondent. As such, whether the wrong inference drawn and structure built thereon without mentioned specific provisions of law or charge define thereon are void ultra viral and without lawful authority
13. By getting the strength from what has been discussed and observed herein above particularly the interpretation of the legal proposition referred in the prescribed law and to follow the ratio decidendi in the judgments of Superior Courts along with the additional observations made thereon, I hold that the impugned show-cause notice along with Order-in-Original No.173 of 2020 dated 11-5-2020 and Order-in-Appeal No.2845 of 2020 dated 22-10-2020 passed by the Deputy Collector (Adjudication) and Collector, of Customs (Appeals), Karachi are suffering from the grave infirmity are declared void, ultra viral, ab-initio, illegal and hereby set-aside. The appeal of appellant is allowed with direction to the respondent to release the vehicle subject to verification of genuineness of vehicle and certificate number nil dated 16.03.2020 provided by the learned counsel for the appellant issued by the M/s. Hino Pakistan Motors Limited, Karachi. As the charge alleged under section 157(2) of Customs Act, 1969 stand established hence hereby invoke the section 181 of the Customs Act, 1969 read with SRO 499(1)/2009 dated 30.06.2009 in terms of Board's letter No.10(7)L&P/05 dated 26.06.2006 to impose 20% redemption fine on the vehicle as per its customs assessed value i.e. Rs.25,00,000/- as mentioned in the show-cause notice and also imposed personal penalty of Rs.25,000/- on the appellant / owner of the vehicle.
14. Judgment passed and announced accordingly.
15. This order consists on 10 pages and each page bears my initial and office seal.