SHAKEEL AHMED ABBASI, MEMBER JUDICIAL-III.----By this order, I intend to dispose of Customs Appeal No.K 8051/2021 dated 21.12.2021 directed against Order-in-Appeal No.648/2021 dated 15.11.2021 passed by the learned Collector of Customs (Appeals) Karachi.
2. Brief facts of the case are that the appellant imported a consignment set to contain "Old and Used Computer Items" vide Goods Declaration No. KPPI-HC-42368 dated 04-12-2020 and sought clearance thereof under respective PCT Headings through their clearing agent.
Whereas, the above referred GD was selected by WeBOC scrutiny in terms of Section 80 of the Customs Act, 1969 and was referred to examination for confirmation of description, weight, quantity and other physical attributes of the goods. Following is the detail of the Examination Report.
"Invoice Not Found Inside The Container, Goods Are Examined On The Basis of Information Retrieved From The System, Documents Scanned, Traders Profile And De Stuffing Of The Cargo As Presented By The Custodian Examined Goods Are As Follows: Description:
1. Used Cpu Core2duo Series Complete With Hard Disk Along With Keyboard, Mouse, Lcd Monitor And Power Cables... Size: 17" Qty: 573 Pcs.. Size: 19" Qty: 663 Pcs. Size: 20" Qty: 154 Pcs... Total Qty: 1390 Sets.. a. Used Cpu Core2duo Series Complete Without Hard Disk Along With Keyboard, Mouse. Lcd Monitor And Power Cables.:. Size: 19" Qty: 110 Pcs... Total Qty: 110 Sets... b. Used Cpu Core /3 Series Complete With Hard Disk Along With Keyboard. Mouse, Lcd Monitor And Power Cables.....Size: 20' Qty: 20-Pcs.:. Total Qty: 20 Sets... c. Used Cpu Core 15 Series Complete With Hard Disk Along With Keyboard, Mouse; Lcd Monitor And Power Cable. ... Size: 20" Qty.: 12 Pcs... Size: 22" Qty: 18 Pcs... Total Qty: 30 Sets... d. Used Cpu Core 17 Series Complete With Hard Disk Along With Keyboard, Mouse, Lcd Monitor And Power Cables ... Size: 22" Qty: 25 Qty: 25 Sets...
2. Used All In One System Along With Keyboard and Power Cables... Qty: 12 Sets... a. Used Led Monitor 22". Along With Power Cables ... Qty 113 Pcs... b. Used Led Monitor 24"... Along With Power Cables... Qty: 172 Pcs... Total Qty: 285 Pcs...
3. Used computer server Qty: 12 pcs...
4. Used laptop with hard disk complete with... of assorted brands and i/o: Qty: 240 Pcs... a. Used laptop hard disk... capacity: upto 500gb... qty: 800. Pes...
5. Used Computer RAM Capacity: Upto 4GB... Qty: 1300 Pcs... 6: Used Hard Disk.-. Capacity: Upto 500gb... brand: Seagate.
WS... Qty: 1565 Pcs...--Checked Weight 100% Vide Qict Weight Slip (Attached) and Found 24840 Kgs.
Images Are Also Attached For Further Confirmation As To Be Consider As Integral Part Of Examination Report. Group May Check All Aspects Including Importability As Per IPO Conditions Of Goods.
3. It was further stated that after perusal of the case in the light of Examination Report it was revealed that importer has imported Undeclared /Excess Quantity / Restricted Banned items as under: Sr No. Description Declared Quantity Found quantity Exbess / Undeclared import Value Taxes Invoice Status 01 Used laptop complete 175240651,176,6331 26.783 Excess quantity found 02 Used led monitor 20285265 1,818, 138598.71 3 Excess quantity found 03 Used hard-disk 2050236531 51 23,89840,800 Excess quantity found.
04 Used computer server-1 21 282,73827,246 Undeclared 05 Used computer ram-i 30013001,743,1657,401 Undeclared Item Nos. 02, 03 and 04, above have been found excess.
4. Accordingly, the assessing authority was of the view that the Importer / clearing agent were under legal obligation and the WeBOC system provides utility for declaring the actual quantity, description and specifications for the assessment, but the same has not been done and with mala fide intention to clear the goods under the garb of other goods. (b) Items Nos. 06 and 07 above have been found undeclared. Whereas, in view of the foregoing, it is established that the imparter/clearing agent has deliberately concealed the actual =material facts and knowingly and deliberately did not make a true declaration of the goods, giving therein, complete and correct particulars of the goods, duly supported by the requisite documents and malafidely avoided correct and due payment of the legitimate amount of duty and taxes leviable therein. Had this willful and deliberate offence gone undetected the government exchequer would have suffer colossal loss of venue. Value of offending goods was calculated as Rs.3,375,723/-. Amount of duty and taxes involved on offending goods was worked out as Rs.850,943/-. Thus, this act of the appellant constitutes an offence within the meanings under the relevant provisions of law.
Accordingly, agreeing with the above findings of the assessing authority, the adjudicating officer held that the charges against the appellant had been proved.
5. Adjudicating proceedings culminated into passing of Order-in-Appeal No.648/2021 dated 15.11.2021 passed by learned Collector of Customs (Appeals). Karachi as under:-- "6. I have gone through the record of the case and the verbal / written arguments putforth by both the parties. The appellants imported a consignment set to contain "Old and Used Computer Items" vide Goods Declaration No. KPI-HC-4301 1-07-12-2020 and sought clearance thereof under respective PCT Headings through their clearing agent. The examination of the goods was conducted which showed that the importer has imported Undeclared /Excess Quantity/Restricted Banned items as under: 01 Used laptop complete 175240651,176,6331 26,783 Excess quantity found 02 Used lcd monitor 20285265 1,818. 138598,713 Excess quantity found 03 Used hard-disk 2050236531 51 23, 89840.800 Excess quantity found.
04 Used computer server-121 282,73827,246 Undeclared 05 Used computer ram-i 30013001,743,1657,401 Undeclared Item Nos. 02, 03 and 04, above have been found excess.
The department alleged that, as per examination report, the quantity/weight of item Nos.2, 3 and 4 of the GD has been found excess of more than 5% of declared weight, while item Nos.6 and 7 of the GD have been found undeclared. During the hearing the AR of the respondent accepted the charge and stated that the respondent is willing to pay the recoverable amount of duty and taxes but is unwilling to pay redemption fine and penalty. This willingness on the part of the appellant to pay duty and taxes is sufficient to establish that the charge levelled in the show-cause notice and subsequently adjudicated is therefore established. Since the appellant is unwilling to pay the entire adjudicated; amount despite clear findings on mis-declaration of the quantity as stated above, therefore, there is no reason to interfere with the Order-in-Original No.1617945-14122020 which is upheld and the appeal being devoid of merit is rejected accordingly"
6. The appellant being aggrieved with the aforesaid impugned order passed by the learned Collector of Customs (Appeals), Karachi filed the instant appeal before this Tribunal and has assailed the impugned order inter alia on the following grounds: A. That, Respondents Nos.01 and 04 i.e. Collector of Custom (Appeal) and Deputy Collector of.
Customs (Adjudication), Custom House, Karachi passed the impugned Order-in-Appeal No.648/2021 dated: 15.11.2021 and Order-in-Original No. ONO-1617945 dated 14.12.2020 respectively without applying the mind judiciously and being totally overlooked / ignored the facts and law points involved in the instant case. Hence the impugned Order-in-Appeal and Order-in-Original are liable to be set aside. That, the impugned Order-in-Appeal and Order-in-Original are totally non-speaking, non-sketchy order and the facts narrated in the said Impugned Order-in-Original passed by the learned respondents Nos.01 and 4 are entirely different with the actual facts of the instant case hence the impugned Order-in-Appeal and Orders-in-Original are liable to be set- aside being non-speaking under the Article 24-A of the General Clauses Act.
B. That, the Respondents Nos.01 and 4 while passing the Order-in-Appeal and Order-in-Original were required to record finding and discuss material evidence available on record unfortunately both the respondents failed to do so. It is pertinent to mention that there is mis-reading, non- reading of evidence and material evidence on record has been ignored which has caused miscarriage of justice which is totally against the Article 4 of the Constitution of Islamic Republic of Pakistan, 1973 and Article 24A of the General Clauses Act, 1897, hence liable to be set aside being "Non-Speaking Order".
C. That he Respondent No.04 was not justified imposing the redemption fine a 35 and on account of mis-declaration of imported goods in term of SRO.499(I)/2009 dated 13.06.2009 whereas the Hon'ble Lahore High Court in its judgment passed in W.P. No 18300/2018 has held that among to' change in section 15 of the Customs Act, 1969 the case attracting Section 32 of the Act would not covered under above said SRO and Respondent No. 1 has also erred in law by upholding the order of the Respondent No. D. That, the impugned Order-in-Appeal and Order-in-Original passed by Respondents Nos.01 and 4 is the result of mis-reading, non-reading of the record, mis-interpretation of law. This also shows non-application of independent judicial mind by both the respondents by dealing with the Quazi Judicial matters. the impugned orders being void, illegal having been passed in utter disregard of the settled principal of Law and fairness and on wrong premises of law is liable to be struck down.
E. That, the learned Respondents Nos.01 and 4 even have not bothered to apply the mind Judiciously that the Appellant has not violated provision of Customs Act, 1969 neither violated the SRO 499(1)/2009 dated 13-06-2009, he just bonafidely importer the above said lot comprised of used Computers and its related accessories. F. That, the learned Respondent No.04 was not justified to invoke the provisions 32(1), 79, of the customs Act, 1969 read with sections 3 and 6 of Sales Tax Act, 1990 further read with section 148 of the Income Tax Ordinance, 2001 against the Appellant and punished under sections 156(14) and 45 read with SRO. 490(1)/2009 dated 13-06- 2009 as mis-declaration and collusion. It is humbly submitted that the learned Respondent No.03 totally ignored/overlooked that the Appellant is a law abiding citizen and had not violated any provisions of Customs Act, 1969 hence he cannot be treated as an offender of mis-declaration or collusion under Section 32 of the Customs Act, 1969 and respondent No.1 has also upheld the order of respondent No. 4 by supporting his version blindly which is liable to be set aside. H. That the learned Respondent No.01 as well as Respondent No. 4 committed the sheer violation of respectful judgment of Lahore High Court passed in W.P. No.18300/18 dated 26.03.2018 stated therein the S.R.O.
499(1)/2009 dated 13-06-2009 was not applicable upon the appellant as per order of High Court.
(Copy of High Court Order in Enclosed herewith as an Annexure-J). That, in addition to all above submissions the impugned Orders prima facie suffers from so many other infirmities and illegalities.
7. Mr. Shakil John, Appraising Officer appeared on behalf of the respondent Collectorate on 08.02.2023 and pleaded that the as per examination repot, items Nos.1, 2 and 3 were found excessed quantity and items Nos.4 and 5 were found undeclared therefore it is requested that the instant appeal may be dismissed. No one appeared on behalf of the respondent Collectorate on the next date of hearing i.e. 20.02.2023. The learned counsel for the appellant attended and argued the appeal which is decided on the basis of available record / parawise comments on grounds of memo. of appeal which are reproduced as under:- .
A. Denied. The orders passed by the Respondents Nos. 1 and 4 are correct and have been passed after due process of law and upon fulfillment of requirements of natural justice and hence are liable to be sustainable under the law.
B. Contents of Ground B are incorrect and as such are vehemently denied. It is denied that the orders are a non-speaking order. The perusal of the orders reveals that the orders passed by the Respondents Nos. 1 and 4 are well reasoned orders reasoned orders; as such the allegations levelled the baseless, hence denied.
C. That the contents of the Ground are vehemently denied. The learned adjudicating authority has passed well-reasoned and speaking order after due process of law and upon consideration of each and every plea of the appellant. The order is thus correct and may kindly be upheld.
D. Regarding contents of Ground D, it is respectfully submitted that the fine imposed by the learned Adjudicating Authority is within the law and in accordance with the provision of Section 181 of the Customs Act, 1969.
E. That in view of the submissions herein above the contents of Ground E warrants no further comments.
F. That the contents of Ground F are vehemently denied. It is clear cut case of mis-declaration of quantity, description (undeclared items found) and imported restricted items into the country in the garb of freely importable goods. Accordingly, contravention proceedings initiated against the appellant for violation of relevant provisions of Customs Act, 1969 and allied laws read with SRO 499(1)/2009 dated 13.06.2009.
G. That the contents of Ground G are vehemently denied. It is respectfully submitted that the appellant mis-declared the quantity, description (undeclared items found) and imported restricted items. This act of the appellant constitutes. an offence within the meanings of Sections 32(1) and (2), 79 and 209 of the Customs Act, 1969 read with Sections 3 and 6 of. the Sales tax Act, 1990 further read with Section 148 of the Income Tax Ordinance, 2001. The offence is punishable under Clauses (1), (14) and 45 of section 156(1) of Customs Act, 1969, read with SRO 499(1)/2009 dated 13.06.2009 and sections 33 and 34 of the Sales Tax Act, 1990 further read with Section 148 of the Income Tax Ordinance, '2001.
H. Regarding contents of Ground H, it is respectfully submitted that keeping in view the facts and circumstances of the appellant's subject case the cited order/judgment is irrelevant and distinguishable, hence, cannot be applied mutantis mutandis.
I. That in the light of submissions made above, the contents of Para I of grounds of appeal are incorrect hence denied. As evident from the Order-in-Original, proper opportunity of hearing was given to the appellant. The adjudicating authority decided the case considering the relevant provisions of law.
J. Ground J needs no comments.
8. I have heard the counsel for the appellant at length and gone through the record of the case and also parawise comments put forth by the respondent. It appears that the learned adjudication officer has imposed redemption fine and penalty on the apprehension that the appellant importer has deliberately committed mis-declaration of contents of the consignments in order to avoid payment of due amount of leviable duty and taxes. However, a dispassionate analysis of the case will reveal that there is some truth in the argument advanced by the appellant that there is absolutely no likelihood of escape of leviable duty and taxes on imported consignments of used computers etc. as these are invariably marked for 100 percent examination and, therefore, the examination reports of such consignments reflect the composition of imported goods accurately thus making it almost impossible to evade leviable duty and taxes on such imports unless there is some oversight by the examination staff of the Collectorate. The learned counsel of the appellant importer has drawn attention of the bench towards the fact that such consignments consists of mixed lot purchased from abroad and it is not possible for the importers to make a correct declaration of all the contents of such consignments at the time of declaration before customs authority. Any mistake in the declaration is, therefore not intentional on the part of importers of such goods by any means.
9. In support of his contention, the counsel of the appellant has submitted that Order-in-Original No.1522402/2020 dated 09.03.2020 wherein the Collectorate has released the identical goods vide GD No.KPPI-HC-61836-25-02-2020 and another GD No.KAPW-HC-105149-11-01-2022 which practice continued upto the recent times. The DR when confronted failed to satisfactorily explain the discriminatory treatment meted out to the appellant in this particular instance. Therefore, I am constrained to hold that the appellant has been treated unfairly. As per established norms, all importers are supposed to be treated at par. The Superior Courts have also ruled more than once that the department cannot extend favorable treatment to one set of importers while denying the same concession to other importers.
10. To fortify the above view, it may not be out of place to mention here that this particular issue had already been settled by the Customs Appellate Tribunal vide judgments bearing No.K- 530/2017 and others. Against the said judgment the department filed SCRA No.20 of 2022 and the same was dismissed accordingly the Tribunal's order attained finality. In some other Customs Appeal No.1891/2020, Customs Appeal No.386/2021 and Customs Appeal No.1495/2016 dated 22.03.2017 Messrs Dogar Traders v. Collector of Customs Port Qasim, Karachi and others decided by the Tribunal in favor of the appellant and against the department. The respondent department had filed SCRA No.341 of 2017 against the said judgments, the Hon'ble High Court of Sindh after hearing the parties dismissed the reference application thus the judgment of the Tribunal had attained finality. Relevant para of the judgment of the Hon'ble High Court of Sindh in SCRA No.20 of 2022 dated 27.04.2022 is reproduced hereunder:- "The record reveals that while the goods were confiscated an option was given to the importer to redeem the confiscated goods after paying 35% redemption fine, as clearly prescribed under SRO 499(1)12009 dated 13.06.2009, in addition to the payment of duty and taxes chargeable thereupon.
The CAT, while disposing of the matter, has categorically observed that difference in the sizes of the bicycles was due to the style of measurement of the consignment. It has clearly been mentioned by the CAT in its order that the department has miserably failed to point out or to justify the guilty intention of the respondent of the mis-declaration. The record further reveals that the goods were examined more than once and the contravention made out by the customs authorities against the respondent due to their own style of measurement, but if the measurement style of the respondent and as disclosed by the consigner is seen there is no difference in the sizes and the measurement worked out by the department so as to make out a case of false and incorrect declaration which was uncalled for. Since the difference in sizes is due to difference in opinion between the department and the respondent, therefore, the CAT has categorically observed that the same could not be made on the basis of contravention or mis- declaration. It is also noted that the respondent also offered the departmental authorities to explain the method of measurement but no heed was paid by them in this regard. It is also a matter of record that bicycles were imported in kilograms and not on the basis of size measurements and the difference in size, as noted by the CAT, was due to measurement of the frames of the bicycles, which according to the CAT was not the correct method of measurement.
Had the bicycles been imported on size basis then it could have been said that the contention of the department is correct but here in the instant case the CAT has observed that the frames of bicycles were imported in kilograms and not by virtue of sizes. It is also observed that the department was duly asked to show that whether their method of Measurement was in accordance with law or not by way of any notification, SRO etc. but no such evidence was produced. It was also observed by the CAT that since onus was not discharged by the department, therefore. The case of mis-declaration was not proved against the respondent. The CAT being the last facts finding authority, has since categorically observed that mis-declaration on the part of the respondent has not been proved by the department. We are of the view that no interference in these findings is warranted as the CAT after thrashing out the case has come to the conclusion with regard to the fact that no discrepancy is found in the description of the goods.
We, therefore, in view of what has been stated above, do not find any reason to interfere with the findings of fact recorded by the CAT and also do not find the questions proposed to be the questions, of law, as in our view, the decision of the CAT is based on facts. The instant SCRA stands dismissed along with listed applications."
11. In view of the foregoing facts, reasons and in the light of judgments, I am inclined to hold that imposition of fine and penalty is not applicable as per the circumstances of the instant case as mentioned above besides being too harsh as it is difficult to prove conclusively an element of mens rea against the importer. Accordingly, the imposed fine and penalty are cancelled / waived.
Resultantly, the Order-in-Appeal No.648/2021 dated 15.11.2021 and Order-in-Original No. 1617945/2020 dated 14.12.2020 are set aside. The appeal stands disposed of with no order as to costs.
12. This judgment consist of seven (07) pages and each page bears my initials as well as official seal with full signature on the last page.