JUDGMENT: MR. HAFIZ ANSAR UL HAQ, MEMBER JUDICIAL/CHAIRMAN.--(1). This appeal has been filed by Syed Azhar ud Din Shah, Director, Alpha Polymers (Pvt.) Ltd., Peshawar and others (appellants herein) against the Order-in-Original No. 99 of 2024, dated 30.04.2024, passed by the Additional Collector of Customs Adjudication, Islamabad Camp Office Custom House Peshawar.
2. Brief facts of the case are that on 31.03.2024 at Hayatabad Toll Plaza, Peshawar, the staff of ASO, Directorate of Intelligence and Investigation(Customs)-FBR, Peshawar intercepted a Mazda Mini Truck bearing Registration No. LES-13-6461 loaded with Chinese Origin Hot Melt Adhesive 200 Ctns each of 25 kg = 5000 kg. The driver Wasim Ullah Khan S/o Nawab Ali Khan R/o Nasar Khel Gundi Sahib Khan P.O Sarai Norang Tehsil Sarai Norang District Lakki Marwat, on demand provided a document bearing No. Nil and logo of Mad Zubair Industries purportedly issued by M/s Asad Zubair Industry, but failed to provide documents of import or a Sales Tax Invoice the vehicle alongwith the goods were brought to the office of I&I-Customs, Peshawar and detained under Section 2kk of the Customs Act, 1969 read with Section 17 and 186 of the Customs Act, 1969 for verification.
On 01.04.2024, the General Manager Farhan Anwar S/o Anwar Khan of M/s Alpha Polymers (Pvt.) Ltd.
NTN No. A323608 located at Plot No. 1, near Malik Taj Petrol Pump, Zaman Abad, Bara Road, District Khyber, submitted a written request for release of the goods on the basis of import GD bearing No. PAKI-HC-9074 dated 18.03.2024 and claimed that the goods belong to them.
The said GD as well as request of General Manager of the M/s Alpha Polymers were perused and it was revealed that the goods therein were imported availing benefit of 12th Schedule S.No.02 Sub-S. No. 01 and S. No. 151 of 6th Schedule of Sales Tax Act, 1990 to be processed and consumed within the limits of FATA/PATA and cannot be removed unauthorized without payment duty/taxes. The documents, were therefore, found irrelevant. As there were reasons to believe that the Hot Melt Adhesive were non-duty paid/smuggled and have been brought into the country through un- authorized route, without payment of duty/taxes, therefore, were seized on 02.04.2024 under Section 168 of the Customs Act, 1969 for violation of sections 2(s), 16 & 157(2) read with section 3(1) of the Imports & Exports (Control) Act, 1950, punishable under clause 8 and 89 section 156(1) of the Customs Act, 1969, further read with section 3(3) of the Imports & Exports (Control) Act, 1950, read with SRO. 499(I)/2009 dated 13.06.2009, further read with SRO. 566(I)/2005 dated 06.06.2005. The case papers were submitted for adjudication in accordance with law.
3. After completion of the requisite codal formalities, the Additional Collector of Customs (Adjudications), Islamabad, camp office, Custom House, Peshawar issued show cause notice and after reply thereof vide the impugned Order-in-Original No. 99 of 2024 dated 30.04.2024, while giving an option under section 181 of the Customs Act, 1969, released the goods against 20% redemption fine in addition to payment of duty/taxes. The vehicle used for transportation of the said goods was also released against 20% redemption fine. Hence the instant appeal on legal and factual grounds mentioned therein.
4. During the course of arguments, learned counsel for the appellant reiterated the grounds of appeal and contended that the act of seizing agency and order passed by the adjudicating authority is absolutely illegal and against the law as said seized goods are duty paid one and both the appellants are taxes payers and all the documents regarding the payment of duty taxes are attached with appeal for the satisfaction of the court; that the goods were loaded from Peshawar by Alpha Polymers vide Bilty No. 807 to Gillani Hygienic Products Islamabad on 31/03/2024.
Documents attached which was seized by the Customs without any verification of the documents which is really injustice; that appellant No. 1 purchased the goods from Gillani Hygienic Product (Pvt.) Ltd. vide Sale Invoice No. 007 DM No. 124 dated 12/02/2024 against 3600000/- rupees and 10% of the total amount amounting 3600000/- was paid in advance and remaining amount of Rs.
3240000/- Cheque No. CA0000000265 was presented to Gillani Hygienic Products (Pvt.) Ltd. With encashment dated of 13/03/2024; that after completion of purchase deal the goods were loaded from Islamabad on dated 12/02/2024 for Peshawar vide Bilty No. 627 all documents including the GD are attached; that the appellant No. 1 could not manage to pay the remaining amount to the company due to the business crisis and left with no option except to return the goods to company which were loaded for Islamabad and seized by the Customs and charged the same as non duty.
He stated that all documents regarding payment of duty taxes. Bilty from Islamabad and from Peshawar including sale invoices and correspondence between two parties regarding the payment of duty & taxes are attached with the appeal. Learned counsel for the appellants prayed for unconditional release of the goods and for remission of the redemption fine imposed on the vehicle.
5. On the other hand, representative of the respondents opposed the contention of the appellants and submitted that the order of learned Collector Customs (Adjudication) is very much clear and is in accordance with law; that the goods were not the same which have been mentioned in the documents by the appellants and the same were non duty paid and smuggled one, therefore, the same have rightly been confiscated; that the documents produced at the time of seizure as well as at the adjudication stage were not relevant. He supported the impugned order and prayed for dismissal of the appeal.
6. Arguments heard and record perused.
7. Perusal of the record reveals that the appellant firm purchased the goods in question (Raw Material used in manufacturing of Diapers) from M/s Gillani Hygienic Products (Pvt.) Limited, Islamabad (the importer/seller) against Sales Invoice No.007, DM No. 1244 dated 12.02.2024 on payment of Rs. 3600000/- (copy of the Invoice is placed at page 11 of the appeal file). According to the stance of the appellant, 10% amount was paid to the said seller vide voucher No. 243 dated 12.02.2024 (copy of the same is at page 17) and the remaining will be paid within 30 days. In this regard, cheque dated 13.03.2024 to the tune of Rs. 32,40,000/- was presented to the company i.e., the seller (placed at page 16 of the file) and the said goods were handed over to the purchaser (appellant) vide Delivery Challan No. 1244 dated 12.02.2024 (at page 12). The goods were, therefore, loaded from Islamabad vide Bilty No. 627 dated 12.02.2024. (at page 18) to its destination at Peshawar.
The learned counsel has also pointed out that the purchaser could not manage to pay the remaining amount on specified time, which resulted into non-fulfillment of contract/agreement by the appellant/purchaser (Correspondence between the importer/seller and the purchaser is available at pages No. 13,14 and 15), therefore, the goods were being returned and dispatched to the importer/seller on 28.03.2024 vide Billy No. 801 (at page 19) from M/s Alpha Polymer (purchaser) to M/s Gillani Hygienic Product (Pvt.) Ltd., Islamabad (importer/seller) in its original condition i.e., Raw Material, which were seized by the Respondents on the allegation that the same non duty paid/smuggled one.
On adjudication of the matter, the said goods were released by the Adjudicating Officer on payment of duty/taxes on the application of the driver of the vehicle. However, the appellant being aggrieved of the order of adjudication has filed the instant appeal on the grounds and contentions mentioned above.
8. The above submissions and record of the case coincide with each other as the goods were basically imported by M/s Gillani Hygienic Product (Pvt.) Ltd., vide GD No. KA.PE-1-2024 dated 01.01.2024, who has subsequently sold it to the present appellant vide the above mentioned Invoice and other supported/relevant documents. No doubt, the Constitution of Islamic Republic of Pakistan has given vested rights to the citizens of Pakistan that includes the right and liberty of lawful business within the parameters of relevant law and rules made thereunder. As per record of the case in hand, the said imported goods were sold by M/s Gillani Hygienic Product (Pvt.) Ltd, Islamabad (importer/seller) to the appellant against handsome amount but the appellant/ purchaser failed to fulfill his obligations as mentioned above, therefore, the same goods were returned to the said seller in its original condition as raw material. Therefore, when Article 18 of the Constitution of Islamic Republic of Pakistan has given vested fundamental rights to the citizens i.e., Freedom of trade, business or profession to run on their lawful business within the parameters of law, then seizure of the legally imported goods in this case does not fall under the domain of customs, which was a private transaction between the seller and buyer within the country on the basis of all relevant supportive documents. However, the matter, which was required to be taken into consideration is the issue and payment of Sales Tax on the supplied goods by the importer/seller that too has been resolved as the goods were being returned, which has categorically been mentioned in the Sales Invoice (at page 11 of the appeal file), that the Sales Tax Invoice will be issued after the completion of remaining invoice amount.
9. In view of the above, the appeal in hand is accepted, the impugned Order-in-Original No. 99 of 2024, dated 30.04.2024; passed by the Additional Collector of Customs Adjudication, Islamabad Camp Office Custom House Peshawar is set aside. The goods are released unconditionally. The redemption fine imposed on the vehicle is also not justifiable as the goods were loaded against proper billy and other supported documents of the legally imported goods, therefore, the redemption fine @20% imposed on the vehicle is also ordered to be remitted.
10. The appeal stands disposed of.
11. Copies of the judgment be sent to the parties and file be consigned to the record after completion.