' JAVED IQBAL, J.---This is a Constitutional petition preferred under Article 199 of the Constitution of Islamic Republic of Pakistan (hereinafter referred to as the Constitution), on behalf of Usman Enterprises with the following prayer:-- "It is, therefore, prayed that this Hon'ble Court may be pleased to:
(a) Declare the assessm ent of U.S. $160 as illegal and without lawful authority.
(b) Declare that the petitioner are liable to pay the duty and other charges at the value declared in the Bill of Entry i,e, U.S. $ 145. 33 per ton.
(c) Any other further/additional relief/reliefs this Hon'ble Court may deem fit and proper in the circumstances of the case
(d) 'Cost of the petition."
2. Briefly stated the facts of the case are that the petitioner is a partnership firm dealing with the importation of vessels for the purposes of breaking at Gadani. It is averred in the petition that the petitioner had imported one unserviceable vessel M.T. "SHINING STAR" of about 133038.66 Gross Registered Tons and 99614.98 Net Registered Tonnage with Light Displacement of 36869 Long Tons, registered in U.A.E. At the cost of U.S. $ 145.33 per Long Tons Light Displacement and accordingly the Bill of Entry was furnished at the value of U.S.$ 145.33 L.D.T. But it was not accepted by the respondent (Customs Authorities) in pursuant to the Collector of Customs Order dated 7-1-1992 and the vessel assessed at U.S. $ 160 per L.D.T It is further averred that in spite of all evidence the respondents have refused to finalize the Bill of Entry on the declared value i,e, U.S.$ 145.33 and insisted that the Bill of Entry be prepared at the rate of U.S. $ 160 per L.D.T.
3. It is mainly contended by Mr. Shakeel Ahmed, Advocate on behalf of the petitioner that assessm ent at the rate of U.S.$ 160 is unjustified, illegal and liable to be set aside. It is also urged emphatically that the above assessment is based upon the letter dated 7-1-1992 which had already been declared as without lawful authority by this Court, hence it cannot be taken into consideration. It is also argued that there is absolutely no evidence on the basis of which such an assessm ent could be made and moreso, is not in conformity with the provisions as contained in section 25 of the Customs Act, 1969.
4. The learned Standing Counsel has strenuously controverted the abovesaid position and argued with vehemence that the assessm ent of duty at the rate of U.S. $ 160. Was not only in conformity with the provisions as contemplated under section 25 of the Customs Act, but sufficient evidence to support the levied duty was also available. He further contended that the discretion vested under section 25 of the Customs Act was never exercised in an arbitrary manner.. In order to substantiate his version he quoted the instances of other Ships namely M.T. "Hellas" imported at the rate of U.S. $ 165 per L.D.T. On 8th August, 1993 and M.T "Horison' imported at the rate of U.S. $ 157.25 per L.D.T on 13th September, 1993. The other contention that proper opportunity of hearing was not afforded repelled being agitated first time during the arguments and never incorporated in the memorandum of petition.
5. We have carefully examined the respective contentions as adduced on behalf of the parties in the light of relevant provisions of the Customs Act, 1969 and the entire record made available. The petition seems to revolve around one main point that the assessment made by the Customs Authority was in violative of the judgment given by this Court' whereby the letter dated 7-1-1992 issued by Deputy Collector Customs was declared as unlawful. The above referred to letter is reproduced herein below for ready reference:-- "GOVERNMENT OF PAKISTAN COLLECTORATE OF CUSTOMS AND CENTRAL EXCISE, CUSTOMS HOUSE, QUETTA.
' C.NO.V-7 (14) Cus /87-pt/378 dated 7-1-1992.
' The Deputy Collector of Customs, ' Gadani Custom House at Hub. - ' P.O. Box 834.
Karachi G.P.O.
SUBJECT: ASSESSMENT OF SCRAP VESSELS.
' Please refer to Pakistan Ship Breaker's Association, Karachi's Letter Nos.C-8/91-090 dated 17-12- 1991 and C-8/91/102/ dated 1-1-1992 regarding the above matter.
' Keeping in view the fact that no vessel imported after 31-10-1991 has so far been cleared in accordance with the decision conveyed vide note bearing C. No,I./Misc/31/91 (G) dated 28-10-1991, the issue has been reconsidered and discussed with the Member (Customs), Central Board of Revenue, Islamabad. It has accordingly been decided that the minimum assessable value of scrap vessels (for levy of Sales Tax, Import Surcharge, Iqra Surcharge and Advance Income Tax) may be determined @ U.S. Dollars 160 per L.D.T. Where, however, declared value exceeds the minimum of U.S. Dollars 160 per L.D.T declared value may be reckoned as assessable value.
(Sd.) xxxxx (MUHAMMAD NAWAZ), COLLECTOR OF CUSTOMS." As it transpires from the contents of the above reproduced letter that the minimum assessable value of the scrap vessel may be determined at the rate of U.S $160 per L.D.T. The said letter was declared as unlawful by this Court in C.P. No, 714/92 with the following observations:-- "It is clear that while fixing the rates on per LDT neither any appraisement of the goods nor any attempt to find out the normal price which the goods would fetch was ever made by the Collector.
So much so that the assessm ent was made by the impugned letter without assigning any appraiser to determine the value or the normal price as required under section 25 of the Customs Act. The case of the respondent in fact was that action had been taken under section 25-B on the basis of impugned letter. In the preceding para. We have thoroughly discussed that no such notification has been issued in the official Gazette by the CBR. Besides, the alternate course open was to take action under section 25 read with section 30 of the Customs Act. Of course any action taken under section 25 read with section 30 of the Customs Act is covered by the procedure as laid down in the aforementioned sections. This plea taken by the Standing Counsel was a futile attempt to justify the action taken by the respondents. The result would be that in all the petitions of Group A the basis of the action was the impugned letter alone which cannot be held to be a substitute for a Gazette Notification. Thus, the rate as assessed by the Collector in the impugned letter regarding scrap of each vessel had been determined without lawful authority hence the same carries no legal effect
6. The above mentioned observation incorporated in the judgment dated 20-9-1993 cannot be made applicable to this petition for the simple reason that the Deputy Collector Customs was neither authorized nor notified under section 25-B of the Customs Act, for issuance of such letter and resultantly the assessm ent fixed in the said letter was declared as unlawful and without any legal sanctity behind it. The said letter has no application whatsoever in this case and as such it hardly renders any assistance to the petitioner's claim. In our considered opinion the pivotal question to be decided is as to whether the assessment made by the Customs Authorities was arbitrary, whimsical and not in consonance with the provisions as laid down in section 25 of the Customs Act. Let us make it clear at this juncture that no bar can be imposed on the discretion of Customs Authorities regarding determination of value normal price of important items but the said discretion cannot be exercised in an arbitrary manner.
It is one of the mandatory prerequisites that such assessment could only be made after taking into consideration the value price of similar and identical items imported during the same period. Any assessm ent in violation of the provisions as contained in section 25 of the Customs Act or without following the prescribed procedure would be of no value and cannot be declared lawful (PLD 1959 SC 364 = 1989 M LD 999). It is, however, to be noted that section 25 of the Customs Act, speaks about the normal price which can further be elaborated as a price which the imported item would fetch on sale in a lawful transaction in an open market.
7. A bare perusal of the provisions as contained in sections 25 and 30 of the Customs Act would show that the normal price is to be determined on the basis of prevalent value in the country of export at the time when imported goods were to be released or duty is payable.
8. There is no cavil to the proposition and as discussed above that determination of the value and assessm ent of duty fall within the jurisdictional ambit of Customs authorities and, therefore, it should not be expected that a definite assessment would be made by this Court while exercising its discretion.
' It is, however, to be seen whether sufficient material was available to get the value enhanced. It is the case of the petitioner that vessel in question was purchased at the rate of U.S.$ 145.33 per LDT and certificate of production indicating the value of vessel produced and the Bill of Entry submitted and declared value was shown as U.S. $ 145.33 per LDT, but the same was not accepted. In support of declared value reliance was also placed on the Memorandum of Agreement (M.OA.) and letter of credit negotiated/executed in-between the petitioner and that of the seller. The Bill of Entry was, however, completed at the rate of U.S.$ 160 per LDT instead of U.S. $ 145.33 per LDT as declared by the petitioner. Nowhere the question arises that as to why the declared value by the petitioner was not accepted by the Customs Authorities and whether sufficient evidence/material was available for imposition of duty at the rate of U.S. $ 160 per LDT. The scrutiny of record suggests that assessm ent by the Customs Authorities was not only in conformity with the provision as contained in section 25 of the Customs Act, 1969, but all the formalities enumerated in the said section were completed and as such the assessm ent of duty at the rate of U.S. $ 160 per LDT cannot be declared as arbitrary or fanciful. The requisite evidence was collected by the Customs Authorities and the duty at the rate of U.S. $ 165 per LDT was imposed on the vessel namely M.T. "Hellas" which was imported on 8th August, 1993. In similar manner the ship namely M.T. "Horizon" was imported at the rate of U.S. $ 157.25 per LDT on 13th September, 1993. We have carefully examined the invoices of the abovementioned two ships which confirm that the assessment was made at the rate of U.S. $ 165 and 157.25 per LDT. The ship M.T. "SHINING STAR" was imported in similar period as such the assessm ent was made at the rate of U.S. $ 160 per LDT. The said assessment was never made in the light of letter dated 7-1-1992 but it was done keeping in view the prevalent duty being imposed during the said period on similar ships. We are therefore, satisfied that the assessment was neither whimsical nor arbitrary but in consonance with the relevant provisions of law.
9. It is urged emphatically that no opportunity of hearing was afforded by the Custom Authorities before enhancing the value. We have thoroughly scanned the memo. Of petition which is silent regarding this point as such probably it cannot be agitated now. If any reference is required for this proposition reliance can be placed on PLD 1966 (W.P.) Peshawar 43.
10. In the light of what has been stated above the petition is rejected with no orders as to cost.