1. ' HAIDER ALI PIRZADA, S. -This petition under Article 9 of the Provisional Constitution Order, 1981 seeks quashing of the orders of the respondent confiscating the goods and imposing personal penalty amounting to Rs, one lac.
2. ' The facts leading to the filing of the above petition are that in or about November, 1984 the petitioners obtained import licence for import of machinery and millworks not otherwise specified and parts and accessories thereof and maintenance spares, all sorts, including (i) items notified in Annexure 1 of Import Policy Order, 1984, (ii) S. No, 422 of Free List Brass/Bronze Gate valves, Cocks of all kinds used as water fittings of the value of Rs, 1,40,000. The petitioners negotiated with one Taka Machinery Corporation for supply of 26 sets of Nikko Branch Portable Generators Gasoline Model SG-2700 valued at U. S. Dollars 350 per set, C & F Karachi. The petitioners accordingly on 21-11-1984 opened an irrevocable Letter of Credit for U. S. Dollars 9,100 in favour of Messrs Taka Corporation, Japan, through Muslim Commercial Bank Ltd., New Challi Branch, Karachi, for import of "Machinery and Millworks Nikko Branch Portable generators. The goods were thereafter shipped per "Atla" under the covers of invoice No, 29546, dated 25-12-1984 and mentioned marks SB/Nikko Karachi C/No, 1- 25". On the importation of the goods at Karachi the petitioners submitted a Bill of Entry under I. G. M.
3. No, 148-58, dated 19-1-1985 Index No, 114 and was registered in the Customs House on 31-1-1985. It is the case of the petitioners that on 31-1-1985 the Federal Investigation Agency and the Customs Staff by joint operation opened the cases and seized the goods alleging that 21 out of 25 cases contained sewing machine parts. The Federal Investigation Agency registered F. I R. On 6-3-1985 under section 156(1)(14) of the Customs Act against the manager and attorney of the petitioners on allegations that false declaration was made in Bill of Entry by mentioning "Marks No, SB/Nikko/Karachi/C. No, 1-25, made in Japan, Machinery and Millworks Nikko Branch Portable Generators Gasoline Model SG-2700 whereas on physical checking it was alleged that 21 out of 25 cases contained sewing machine parts.
4. ' It appears from the records that credible information was received and the bill of entry alongwith relevant documents was intercepted by F. I. A. A joint examination was carried out which revealed that the cases contained sewing machinery parts alongwith 4 sets of generators. The total value of consignment according to the prices available with Customs worked out to Rs, 10,60,985 as against the declared value of Rs, 1,38,769. This was a case of misdeclaration preplanned attempt to evade the Government revenue.
5. ' On April 8, 1985 show-cause notice was served on the petitioners. The petitioners thereupon sent elaborate reply setting forth its pleas that in law, no action could be taken against it. It pleaded that it had no knowledge if industrial sewing machines were imported into Pakistan. It pleaded that due to heavy rush at Kobey Port on account of year closing followed with holidays the consignment of generators and machines parts were mixed up and as a result of this, 20 cases out of 24 cases of generators which were meant for Iranian Port were supplied alongwith the consignment of generators. The petitioners also pleaded that the import value as had been worked out by the respondent was not Rs, 10,60,986 but it was Rs, 7,44,941.
6. ' On receiving the reply sent by the petitioners, the respondent No, 2 heard the petitioners and on July 19, 1985 he passed the impugned order. He held that having carefully considered the written explanation tendered and oral arguments urged before him in regard to the matters, the explanation offered appeared to him to be unsatisfactory and unacceptable.
7. ' He confiscated the consignment. He also imposed a personal penalty of rupees one lac. His conclusion, therefore, was that the charge of deliberate misdeclaration was conclusively established. The value of consignment was determined at Rs, 7,44,491.
8. ' The petitioners then preferred an appeal before the Central Board of Revenue. The Board considered the matter and came to the conclusion that none of the contentions raised by the petitioner was either warranted or supported by law as it stands. The Board expressed its concurrence with the conclusions of the respondent No, 2 that the offence under section 32 had been proved and the petitioner was liable to be dealt with under section 156 (9 and 14) of the Act.
9. This order was pronounced on 31-10-1985. The petitioner being aggrieved filed the above petition.
10. ' The respondents filed counter-affidavit of Aftab Azam a principal appraising of Customs Appraisement and stated therein that on receipt of credible information, the F. I. A. Seized the documents only on 31-1-1985. Show-cause notice was issued by registered post on 4-4-1985. The petitioners filed affidavit-in-rejoinder in the above petition.
11. ' The petitioners annexed Annexure '0' to the affidavit. A perusal of this Annexure shows that F. I. A.
12. Wrote a letter, dated 1-2-1985 to the Supervisor Shed No, 13, K. P. T. East Wharf, Karachi stating therein that "the consignment may not be removed/disposed of/opened without the permission from this office as the above consignment is a subject-matter of above-mentioned Enquiry."
13. ' A bare perusal of Annexure 'F" to the petition shows that on 30-1-1985 the F. I. A. Seized the following documents :- "(1) A set of bill of entry I. G. M. No, 148, dated 19-1-1985, Index No, 114, dated 30-1-1985.
(2) Customs copy of Import Licence No, B-156094, dated 14-11-1954.
(3) Copy of Import Invoice bearing portable 25 (25 cases of machinery and Millworks "Nikko" Branch portable generators Model SG-2700, valued U. S. Dollars 8750.
(4) Copy of L/C No, N. C. 36/1040 SEK-361, dated 21-11-1984 of Muslim Commercial Bank Ltd., Karachi.
(5) Photo copy of N/L No, 35-044, dated 27-12-1984."
14. ' In order to appreciate the abovesaid contentions raised by the learned counsel for the parties, it is necessary to reproduce the provisions contained in section 180 and relevant section 168 of the Customs Act (hereinafter called the said Act) which read as under :- "180.-No order under this Act shall be passed for the confiscation of any goods or for imposition of any penalty on any person, unless the owner of the goods, if any, or such person-
(a) is informed in writing (or if the person concerned consents in writing, orally) of the grounds on which it is proposed to confiscate the goods or to impose the penalty ;
(b) is given an opportunity of making a representation in writing (or if the person concerned indicates in writing his preference for it, orally) within such reasonable time as the appropriate officer may specify against the proposed action ; and
(c) is given a reasonable opportunity of being heard personally or through a counsel or duly authorised agent.
15. "168.-(1) The appropriate officer may seize any goods liable tc confiscation under this Act, and where it is not practicable to seize any such goods, he may serve on the owner of the goods or any person holding them in his possession or charge an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.
(2) Where any goods are seized under subsection (1) and no show-cause notice in respect thereof is given under the goods shall be returned to the person from whose possession they were seized : ' Provided that the aforesaid period of two months may, for reasons to be recorded in writing, be extended by the Collector of Customs by a period not exceeding two months."
16. ' The bare perusal of subsection (1) of section 168 shows that the appropriate officer may seize any goods liable to confiscation under the1 said Act and where it is not practicable to seize any such goods, he may serve on the owner of the goods or any person holding them in his possession or charge an order that he shall not remove, part with or otherwise deal with the goods except with the previous permission of such officer.
17. ' The language of subsection (2) of section 168 admits, of no ambiguity and it prescribes an initial period of sixty days commencing from the date of seizure of goods for the issuance of notice under section 180 of the said Act. The proviso attached to subsection (2) of section 168, however, provides that the said period of sixty days can be extended by a period not exceeding two months by the Collector of Customs for the reasons to be recorded in writing.
18. ' Mr. J. H. Rahimtoola, learned counsel for the petitioners has raised the following contentions :- "(1) The show-cause notice was served beyond 60 days.
(2) The allegations in show-cause notice were not specific and did not mention that the declaration were knowingly false or the petitioners had reason to believe that the same were false and as such the same were not in accordance with section 32 of the said Act."
19. ' Mr. Liaquat Merchant, the learned Deputy Attorney-General has submitted that a show-cause notice under section 180 of the said Act, seizing the documents only on 30-1-1985 has been served upon the petitioners and, as such, the respondents cannot return the goods to the petitioners. On the other hand Mr. J. H. Rahimtoola has contended that under subsection (2) of section 168 of the said Act, a vested right had accrued to the petitioners to claim the return of the goods, because no notice, as required by section 180 of the said Act, had been given to the petitioners within the prescribed period.
20. ' The point raised by the petitioners that show-cause notice was bad for the reason that the same was not issued within the initial period of sixty days and the said period had not been validly extended, as required by subsection (2) and proviso thereto of section 168. Section 168 of the said Act enacts provision relating to the seizure of goods, while section 180 makes provision for issue of show-cause notice for confiscating of goods. Seizure of goods and confiscation of the same are distinct and different matters. Seizure would mean taken possession. The ordinary rule is that no goods or property of any citizen can be seized and he cannot be deprived of its user. In departure of this rule, section 168 of the said Act empowers the appropriate officers that when any goods are liable to confiscation to seize the same. When subsection (1) of section 168 has empowered the appropriate officer the special right to seize such goods, its subsection (2) places a corresponding obligation on him that in the event of seizure of goods he is bound to proceed for adjudication of confiscation of the goods at an early date. In order to see that the appropriate officer should not retain such goods after seizure of the same and deprive the owners of their user, subsection (2) of section 168 requires that a notice, as required under section 180 of the said Act, should be given to the person from whom goods had been seized, within a period of two months, and if such notice is not given to him the goods must be returned to him. The word "return" -would wan to pass back or to release the same from seizure. But it would not tantamount to cessor of the liability of the goods from confiscation under the provisions of the said Act. Therefore, subsection (2) of section 168, in our opinion, makes provision for curtailment of the period during which seized goods can be retained for issuance of notice under section 180(a). Once the said notice is issued within the period prescribed under section 168(2), the goods seized can be retained till the adjudication of the confiscation proceedings. So, the failure on the part of the Customs Officers to issue notice within the period contemplated by subsection (2) o proviso thereto, of section 168, would certainly clothe the person, from whom the goods have been seized with the right to claim the return of the 1 same but it does not, in our opinion, set at naught the provision of section 180 and will not deprive the customs officers to issue notice under section 180, the obvious reason that it (section 180) does not prescribe any time limit for issuance of such notice. All that it provides is that no order under the said Act shall be passed for the confiscation of any goods or for imposition of any penalty on any person unless the owne of the goods, if any, or such person is informed in writing under clause (a) is given an opportunity of making a representation under clause (b) and I given a reasonable opportunity of hearing under c ause (c). There is nothing in the said section from which an inference can possibly be drawn that the said notice contemplated by clause (a) of section 180 is subject to the provision contained in section 168 of the said Act. As suo, it would not, in our opinion, be proper to import the limitation of two months prescribed by subsection (2) of section 168 (which can be extended for a further period not exceeding two months, vide proviso to the said subsection (2)) into the provision of section 180 of the said Act. Clearly, section 180 does not prescribe any time limit for issuing the show-caus notice and we do not think that it is permissible to go into the intention o the Legislature for not making provision for such a time limit in it. Therefore, it would not be legitime' to curtail the extent and scope o section 180 of the said Act, which, as indicated above, does not contain any time limit for issuance of show-cause notice by saying that in view of the provisions of subsection (2) of section 168, the said notice must b issued within sixty days of the seizure of the goods or within the duly extended period of not more than sixty days thereafter. In that view o the matter, it cannot be maintained that a notice, as required unde clause (a) of section 180 of the said Act is illegal, simply because it had not been issued within sixty days or the extended period contemplated by subsection (2) of section 168 of the said Act.
21. ' Apart from the above legal position, the factual position in the instant case is that on 30-1-1985 the F. I. A. Seized the documents and carried out the examination of the goods. F. I. A. Lodged F. I. R.
22. On 6-3-1985 and commenced investigation. The goods were seized by seizure report, dated 12-2- 1985. The seizure report is annexed to the counter-affidavit as Annexure 'A'.
23. The learned Deputy Attorney-General has submitted that the goods were not seized on 30-1-1985, bit the goods were detained and has referred to the Black's Law Dictionary where words 'detain' and 'seizure' have been defined. He has also referred to a decision in case of Yousuf Re-rollin Mills v.
24. Collector of Customs (1), where a Division Bench of this Court (here one of us namely Abdul Qadeer Chaudhry, J. Was party) held a follows : "We are clear in our mind that the goods in question were detained b the customs authorities and they were not seized, therefore, action under section 168 could be initiated against the petitioner."
25. ' The Division Bench has come to the conclusions after giving cogent reasons which are fully supported by the various authorities and dictionary meaning discussed by them in the said judgment that the goods were detained. We are in respectful agreement with this judgment and for the reasons given by them in their judgment and as such we are of the opinion that on 30-1- 1985 the goods were detained.
26. ' We are of the opinion that the goods were seized by seizure report, dated 12-2-1985 and a show- cause notice was issued on 4-4-1985 and which was served on the petitioners on 8-4-1985. The show-cause notice was issued within the prescribed period. It seems that the provisions of section 168 of the said Act were duly complied with.
27. ' In our view there is no merits in the contention that the respondents are bound to restore to the petitioners all that was seized, as the show cause was served beyond the period.
28. We now turn to the second contention of the learned counsel for the petitioners that the allegations in shoal-cause notice were not specific and did not mention the declaration, were knowingly false or the petitioners had reason to believe that the same were false and as such the same were not in accordance with section 32 of the said Act.
29. ' In order to appreciate the above contention raised by the learned counsel for the petitioners, it is necessary to reproduce the provisions contained in subsection (1) of section 32 of the said Act which read as under : "32.-(1) If any person, in connection with any matter of customs,-
(a) makes or signs or causes to be made or signed, or delivers or causes to be delivered to an officer of customs any declaration, notice, certificate or other document whatsoever, or makes any statement in answer to any question put to him by an officer of customs which he is required by or under this act to answer."
30. (knowing or having reason to believe that such document or statement is raise) in any material particular, he shall be guilty of an offence under this section.
(1) 1986 CLC 77 ' Section 79 of the said Act need not be set in extenso as it merely provides that the owner of any imported goods shall deliver to the Customs Officer a Bill of Entry in such form or manner and containing such particulars as the Board may direct.
31. ' The remaining provisions of the said Act which are relevant to this case, are reproduced below : "Section 156. Whoever commits any offence described in column 1 of the table below shall be liable to punishment mentioned against the offence in column 2 thereof :-- {{TABLE}} 1 2 3 Offences Penalties Section of the said Act. #TBS 9. (1) If any goods, not being goods referred to in clause 8, are imported into or exported from Pakistan evading payment of leviable Customs duties or in violation of any prohibition or restriction on the importation or exportation of such goods imposed by or under this Act or any other law ; or
14. If any person commits an offence under section 32. #TBE Such goods shall be 15 & 16 liable to confiscation ; and any person concerned in the offence shall also be liable to a penalty not exceeding two times the value of the goods. Such person shall be liable to a penalty not exceeding (twenty-five thousand) rupees or three times the value of the goods in respect of which such offence is committed, whichever be greater ; and such goods shall also be liable to confiscation (and upon conviction by a Magistrate, he shall further be liable to imprisonment for a term not exceeding three years, or to fine, or to both).
32. It may further be noticed that subsection (1) of section 3 of the Imports and Exports .(Control) Act, 1950 provides that the Federal Government may, by order, published in the official gazette, and subject to such conditions and exceptions as may be made by or under the order, prohibit, restrict or otherwise control the import or export of goods of any specified description, or regulate generally all practices (including trade practices) and procedure connected with the import or export of such goods. Subsection (2) of this section prohibits the import or export of goods, except in accordance with the conditions of a licence to be issued by the Chief Controller, or any other officer authorised in this behalf by the Federal Government. Subsection (3) enacts that all goods to which any order under subsection (1) applies, shall be deemed to be goods of which the {{TABLE}} import or export has been prohibited and restricted under section 16 of the Customs Act and all the provisions of that Act shall have effect.
33. ' It is not denied that sewing machine parts, which had been imported in this case were not covered by a licence and that they were within the mischief of section 3 of the Imports and Exports (Control) Act.
34. ' The learned counsel for the petitioners has drawn our attention to the case of Eastern Rice Syndicate v. Central Board of Revenue (1) where the Hon'ble Supreme Court laid the following principles of law while interpreting section 39 of Sea Customs Act, 1877 which is para materia to section 32 of the Customs Act :- "The essence of this penal provision appears to be that the offender has obtained an advantage at the hands of the Customs authorities or has induced them to take some form of action authorised by the statute, by making a statement which "is untrue in any material particular". There need be no doubt whatsoever that the word "untrue" carries the sense of falsity to the knowledge of the person concerned. Thus, upon a point of mere -valuation, if a declaration is made by such a person which on enquil y the Customs authorities find to be too low, that will not be by itself sufficient to prove that the declaration was false to the knowledge of the maker, but it would be necessary also to establish that at the time when he made the declaration he was in possession of facts from which the necessary inference would be that the value declared by him was too low and that the value which he ought to declare was the same as that subsequently ascertained by the Customs authorities through their own processes, which are of course processes not available to the person concerned. The application of item (9-B) of section 167 appears to have been made on the basis that by deliberately and falsely showing a low invoice value the importer in each of these cases succeeded in bringing into the country against his allowance of foreign exchange, a much larger quantity of goods than that which he could have brought had he declared the correct value, which in the opinion of the authorities was the value ascertained by themselves.'
35. ' In Pakistan v. Hard Castle Waud (Pak) Ltd. (2), the Hon'ble Supreme. Court laid down the following dictum : "The interpretation, placed on section 39 of the Act in the Eastern Rice Syndicate case by this Court was that in order to attract this penal provision, it must be established that the person who is alleged to have made any statement in a document, submitted to the Customs authorities must be false to the knowledge of the person concerned. It is obvious that such knowledge would depend upon the facts and circumstances of each case. It is not disputed that the statements made in the Customs documents in the instant case regarding the nature and value of the goods imported were in fact false."
36. ' It was further held :- "It was stranuously contended on behalf of the respondents that even item 37-B required mens rea to be proved before penal action could be taken against a person concerned. It seems to us that this
(1) PLD 1959 SC 364 (2) PLD 1967 SC 1 contention is devoid of substance. The language of section 167 (37-B) suggests that this is a case of absolute statutory liability. The only condition of the attachment of this liability is that it should have been found as a fact that the goods not declared to the Customs authorities were concealed or mixed with goods so declared. There are no words in this item which could justify placing it on a par with section 39 of the Act which requires that an oral or written statement in a document should be "untrue" and not merely false. It is also significant that apart from the penalty of confiscation, a personal penalty, imposable under item 37-B, cannot exceed Rs, 1,000. This contrasts with the penalty imposable under item 9-B which can be three times the value of goods, if that be in excess of Rs, 1,000. This fact also supports the inference derivable from the language of item 37-B that the Legislature intended this to be a case of absolute liability, for which no mental ingredients need be proved. The Collector's order, therefore, imposing the impugned penalties on the importers is not open to any legal exception.'
37. ' In order to test the validity of the arguments we need consider certain provisions of the said Act.
38. Section 2(c) defines : "bill of entry" as bill of entry delivered under section 79". Section 2(s) defines : "Smuggle" means to bring into or take out of Pakistan in breach of any prohibition or restriction for the time being in force, or evading payment of Customs-duties or taxes leviable thereon,-
(i) gold bullion, silver bullion, platinum, palladium, radium, precious stones, antiques currency, narcotics and narcotics and psychotoropic substances ; or manufactures of gold or silver or platinum or palladium or precious stones, and any other goods notified by the Federal Government in the official Gazette which, in each case, exceed five thousand rupees in value , or
(iii) any goods by any route other than a route declared under section 9 or 10 or from any place other than a Customs-station and includes and attempts abetment or connivance of so bringing in or taking out of such goods ; and all cognate words and expressions shall be construed accordingly."
39. It is noteworthy that the "entry" for home consumption or warehousing mentioned in section 79 is in respect of goods only that is to say goods brought into Pakistan from a place outside Pakistan.
40. There is no dispute in the instant case that there was a bill of entry delivered by the petitioners but the seized goods (sewing machine parts) did not figure in the said bill of entry. There is also no dispute that the goods that were seized were prohibited goods, importation whereof without a valid licence is prohibited under section 16 read with section 3(1) of the Import and Export (Control)
41. Act and that such goods are liable to confiscation under clauses (9) and (14) of section 15 of the Customs Act read with section 3(2) of the Import and Export (Control) Act.
42. ' In the instant case, before the Customs authorities as well as before this Court, the petitioners have tried to pass on the blame for the wrong statement to the exporters namely Messrs Takka Machinery Corporation Japan. The suggestion is that the exporters committed a mistake in sending cases containing Sewing Machine Parts of higher value than generators. In this context reliance was placed on telexes and letters which the petitioners were able to obtain from the foreign exporters and which they produced before Customs authorities showing that a mistake had been made in dispatching goods, owing to similar marking on the cases. This was a belated attempt to cover up the fraud. The long arm of accidental mistake would be strained to breaking point if it is to be imagined that out of consignment of 24 cases of 26 sets of portable generators gasoline model, the foreign exporters could have sent as many as 21 cases of sewing machine parts, should have been included by sheer mistake. All this material was before the respondents and justified their conclusion implied in the confiscation of the goods and imposition of personal penalty and the respondents regarded the petitioners to be guilty of deliberate gross misdeclaration. Section 32 of the said Act consequently is applicable with full force to the petitioners.
43. ' We are of the view that in order to establish the contravention of section 32 of the said Act mens rea need not be proved, the knowledge of the petitioners was in the context of section 32, being entirely irrelevant. What was relevant, according to us, was that the goods seized were imported into Pakistan without valid licence.
44. ' The scheme of section 156 supports the contention of the Deputy Attorney-General that if section 32 is read alongwith section 156(9) and (14) it would be clear that the Legislature intends, by necessary implication, the exclusion of mens rea, in dealing with the contravention of section 32.
45. Section 156(9) provides that if any goods, not being goods referred to in clause (8), are imported into or exported from Pakistan evading payment of leviable Customs duties or in violation of any prohibition or restriction on the importation or exportation of such goods imposed by or under this Act or any other law such goods shall be liable to confiscation ; and any person concerned in the offence shall also be liable to a penalty not exceeding two times the value of the goods. Section 156(14) provides that if any person commits an offence under section 32, such person shall be liable to a penalty not exceeding twenty-five thousand rupees or three times the value of the goods in respect of which such offence is committed, whenever be greater ; and such goods shall also be liable to confiscation and upon conviction by a Magistrate, he shall further be liable to imprisonment for a term not exceeding three years, or to fine, or to both. It would be noticed that in column 1, section 156(91 and (14) reproduces the material words of section 16 and section 32 and does not add words "knowingly or having reason to believe". It is significant that the words "knowingly" is used in several other provisions contained in section 156. Thus, where the Legislature wanting to introduce the knowledge or having reason to believe or intention actuated the commission of the offence as an essential element of the offence, it has used appropriate words to indicate that intention. The failure to use similar words in section 156(9) and (14) cannot, therefore, be regarded as accidental but must be held to be deliberate, there is some force in this argument as well.
46. ' We are unable to hold that the Customs authorities in the instant case had not proved or established that the declarations made in this case were false to the knowledge of the petitioners or that there was no evidence before the Customs authorities that the petitioners were in league with the foreign exporters.
47. ' In the result, constitution petition stands dismissed. There will be no order as to costs.