1. ' SARMAD JALAL OSMANY, J.--This petition impugns the order dated 18-6-1998 issued by respondent No,3 viz. Assistant Collector of Customs (Bonds) whereby the licence of the petitioner to operate its Duty Free Bonded Warehouse has been suspended.
2. ' The brief facts of the matter as per the Memo. Of Petition are that the petitioner is the holder of Licence No,PWL-3/90 (Diplomatic) which entitles it to operate its Diplomatic Duty Free Bonded Warehouse and the same has been granted by the respondent No,2 in accordance with section 13 of the Customs Act, 1969. It is contended that right from the very inception of the business the petitioner is being harassed by the respondents on and off and ultimately this resulted in the issuance of the impugned order whereafter an investigation was carried out by the Customs Authorities on 21-7-1998 but no incriminating evidence was found against the petitioner which could warrant the issuance of the impugned order.
3. ' Based upon the above facts the impugned order has been challenged on variots grounds, inter alia, that no notice was issued to the petitioner and also no personal hearing was afforded to it before its licence was suspended that from the inquiry report and the Investigation Report dated 21-7-1998 no material is forthcoming which would warrant issuance of the impugned order; that after issuance of the impugned order the petitioner has been consistently writing to the Customs Authorities requesting them for a personal hearing and investigation of the matter but to no avail; that as a result of the impugned order the Bonded Warehouse has been sealed and the petitioner has been prevented from doing its lawful business and finally that the impugned order is mala fide without jurisdiction and suffers from gross illegality. In support of these contentions Mrs. Naveen S. Merchant, learned counsel for the petitioner has submitted that in the first instance as no notice was issued under section 168 of the Customs Act, as a result, the property seized/sealed by the Customs Authorities in pursuance of the impugned order would have to be desealed/returned to the petitioner. Learned counsel further contends that the provisions of section 162 of the Customs Act also have not been followed in as much as no search warrant was obtained at the time the petitioner's premises were thoroughly searched, inventory made and thereafter sealed. Similarly learned counsel has vehemently stressed that notice under section 171 of the Customs Act was not served upon the petitioner and accordingly the entire exercise of sealing/confiscation of the property is rendered infructuous being a gross violation of the law. However, learned counsel's main thrust is upon the ground that before issuance of the impugned notice in terms of section 13(4) of the Customs Act whereby the petitioner's licence was suspended, the Customs Authorities were bound to issue a show-cause notice and hear the petitioner. Since this was not done, therefore, the entire exercise was a nullity in the eyes of law and accordingly mere nonconformity with section 13(4) of the Customs Act is sufficient for the grant of the prayers made in the petition.
4. In support of her contention learned counsel has relied upon Khalid Agencies v. Collector of Customs 1990 SCM R 447; AlRukiya Traders v. Central Board of Revenue 1995 CLC 1456; Deputy Collector, Central Excise and Land Customs, Lahore and 2 others v. Muhammad Munir and others 1989 SCM R 311; Messrs Shaheen Calico Printing Works v. Mumtaz Ali Khan and 3 others PLD 1995 Lah.
5. 1442.
6. ' On the other hand as per the counter-affidavit and parawise comments filed on behalf of the respondents it is contended that the petition is not maintainable since the licensees of the bond who are actually the partners of the petitioner (it being a partnership concern) i,e, a certain Mrs. Susan a Christian and Mr. Abdul Rahman Ahmad, an Ahmadi, are not actually running the business but it is being run by some other persons who being Muslims are not entitled to do so. This contention is further clarified to the effect that since a licence to run a Diplomatic Bonded Warehouse can only be granted to non-Muslims which in this case are the said Mrs. Susan and Mr. Abdul Rahman Ahmad who reside in Islamabad and Rawalpindi respectively, therefore, the person filing the petition i,e, a certain gentleman by name of Mr. Sumbul Ali is not authorised to do so and also the petition is not maintainable to the extent that the said Mr. Sumbul Ali was not the licensee of the petitioner. It has been further contended that an adequate remedy is available under the Customs Act i,e, by way of appeal/revision, therefore, the petition is not maintainable to the extent that the said remedy has not been exhausted. Finally by way of preliminary objections it has been maintained by the respondents that the Icence was valid up to 30-6-1998 and was not renewed thereafter due to noncompliance of the formalities, thus, the petition is not maintainable to the extent that on the day of filing of the petition i,e, 11-8-1998 the petitioner was not a licence holder.
7. ' As regards the merits of the case it has been maintained by the respondents that no harassment has been meted out by the respondents and in fact upon previous inspection of the petitioner's Bonded Warehouse it has been established that some goods were unaccounted for and that certain documents had been tampered with as a result of which the impugned order was issued. It has also been maintained that the respondents' impugned action under section 13(4) of the Customs Act is not illegal since in terms thereof the petitioner's licence can be suspended prior to a show-cause notice which is to be issued thereafter. Finally it was maintained that the goods lying in the Warehouse have not been seized but the operation of the warehouse has been temporarily suspended.
8. ' On the above pleadings Mr. Mubarak Hussain Siddiqui, learned D.A.-G. Appearing for the State has submitted that sections 162, 163, 168 and 171 of the Customs Act do not come into the picture at all particularly as regards the facts of the present petition are concerned. With reference to section 168 of the Act, learned D.A.-G. Contends that no seizure of the petitioner's property is involved as by virtue of section 13(3) the business of the petitioner has automatically stopped, and thus, notice under section 168 is not required. His other contention is that the provisions of sections 162, 163 and 171 of the Act as to obtaining search warrants and giving notice contemplated thereunder are also not relevant as they appear in Chapter XVIII of the Customs Act which provides the power of seizure of the goods. Whereas the provisions regarding entry into bonded warehouse for the purposes of making inventories of the contents thereof appear under sections 91 and 92 of the Customs Act. Finally learned D.A.-G. Has cotended that the impugned order was validly issued as no notice is necessary for suspension of the licence under section 13(4) of the Act. Learned D.A.-G.
9. Has relied upon Sharifuddin v. The Zonal Municipal Committee 1994 M LD 1062 as well as Mushtaq Hussain v. Collector of Customs 1996 CLC 1319.
10. ' We have heard the learned counsel for the parties and their submissions are considered in seriatim below:
1. Regarding the preliminary objections raised by learned D.A.-G. It may be observed that whether or not the petitioner's licence is to be suspended/cancelled on the basis that it is being misused by persons i,e, Muslims who are not entitled to the licence under the law, depends upon p further domestic enquiry into the matter and the same cannot be agitated in these proceedings.
11. Consequently we are of the view that the maintainability of the petition cannot be challenged on this score. So also learned D.A.-G. Has asserted that the person filing the petition is not authorised to do so which objection has been squarely met by the petitioner by filing the necessary letter authorising Mr. Sumbul Ali, under whose signature the petition has been filed to do the needful.
12. Consequently we are satisfied that the petition has been properly filed and cannot agree with learned D.A.-G. That it should be rejected on this score. As to the objection that the petitioners have not exhausted the remedies available in the Customs Act before approaching this Court suffice it to say that in the circumstances of the case and for the reasons to be expressed here after we are of the opinion that the remedies available to the petitioner are not adequate or efficacious enough to reject the petition for this reason alone.
2. Regarding the next issue i,e, the applicability of sections 162, 163, 168 and 171 of the Act we agree with learned D.A.-G. That these would not apply to the case at hand. It would be seen that the said sections appear in Chapter XVIII of the Act which is entitled "Prevention of Smuggling Powers of Search, Seizure and Arrest Adjudication of offences" and a plain reading of the said sections it is quite clear that the provisions thereof are aimed at the curtailment of smuggling and the powers of the Customs Authorities in relation thereto. On the other hand, the regime created by the Act, with respect to the licensing of Bonded Warehouse and their operation etc. Appear in Chapter III which is entitled "Declaration of Ports, Airports, Land Customs Stations etc." and Chapter XI which is entitled "warehousing", respectively. It would, thus, be seen that these chapters create an independent regime whereby the licensing, regulation and operation of customs bonded warehouses are controlled and provide for various aspects relating thereto including section 91 for access of Customs Officer to Bonded warehouse, section 92 for re-opening and examination of packages lodged therein by Customs Officers, section 117 for the joint custody of a private Warehouse by the Customs Authorities and the licensee. In our view the impugned action of the Customs Authorities whereby the petitioners' warehouse was searched on 28-7-1998 and an inventory made of its contents in the presence of the petitioner's representative and a First Class Magistrate is within the powers of the Customs Authorities under section 91 of the Act which provides for access of a Customs Officer to a private bonded warehouse licenced under the Act. In the absence of such powers, it is inconceivable as to how any investigation could be carried out by the Customs Authorities as to the contents of a private bonded warehouse whenever there is any allegation of wrongdoing, as in the present case by the licensee of such warehouse as regards the operation thereof. In the present case, it is alleged in the impugned order dated 18-6-1998 and the acts complained of were tampering of ex-bond bills of entry which were sought to be confirmed by the subsequent search of the warehouse on 28-7-1998. In this view of the matter we are unable to agree with learned counsel for the petitioner that the respondents impugned action of searching the warehouse would require any notice under section 168 or 171 of the Act or that the provisions of sections 162 and 163 were attracted thereto with respect to obtaining any search warrant etc. For this purpose. As to learned counsel's contention that there is no provision in the Act for sealing of a bonded warehouse, we are of the opinion that as rightly contended by learned D.A.-G., after suspension of the petitioner's licence the petitioner's business would automatically cease as long as the matter was under investigation and as such there was no "sealing" of the premises involved.
13. The petitioners cannot be allowed to carry on its business which allegedly was being conducted unlawfully while its affairs were under investigation. Of course the petitioner could always claim damages from the Customs Authorities for any loss of business which may have accrued to it during the period its business remained suspended. Finally it was contended by learned D.A.-G.
14. That section 13(4) of the Customs Act entitled the Customs Authorities to suspend the petitioner's licence before affording it any show-cause notice or hearing. In this regard it would be beneficial to reproduce section 13 of the Act which reads as follows:-- "13. Power to licence private warehouses.--(1) At any warehousing station, the Collector of Customs may, from time to time, licence private warehouses wherein dutiable goods may be deposited.
(2) (Every application for a licence for a private warehouse shall be made in such form as may be prescribed by the Collector of Customs.)
(3) A licence granted under this section may be cancelled by the Collector of Customs for infringement of any condition laid down in the licence or for any violation of any of the provisions of this Act or any rules made thereunder, after the licensee has been given proper opportunity of showing cause against the proposed cancellation).
(4) Pending consideration whether a licence be cancelled under subsection (3), the Collector of Customs may suspend the licence."
15. ' It would, thus, be seen that upon a plain reading of subsection (3) of section 13, it is quite clear that a licence issued under subsection (2) cannot be cancelled unless the licensee is given a proper opportunity for showing cause against the proposed cancellation. Thereafter subsection (4) empowers the Collector of Customs to suspend the licence during the pending of the proceedings under subsection (3). In these circumstances, we cannot agree with learned D.A.-G. That without issuance of the show-cause notice contemplated under subsection (3), the petitioner's licence can be suspended under subsection (4). In any event, it is settled that where a particular provision of law which is aimed at depriving citizens of their rights as to property or person, is silent as to prior notice before commencement of the proceedings, such notice shall be read into that provision of law. This reflects the maxim "audi alteram partem" (no man shall be condemned unheard). In this regard reference can be made to Commissioner of Income-tax, East Pakistan v. Fazlur Rehman PLD 1964 SC 410.
16. ' Consequently, in view of all the above circumstances the impugned order dated 14-6-1998 is struck down as being in violation of section 13(3) and (4) of the Customs Act, 1969. The respondents are directed to decide the matter in accordance with law after giving the petitioner full opportunity of being heard. In consequence of the above the petitioner shall be entitled to carry on their lawful business till such time as the proceedings under section 13(3) of the Act are pending. Of course this would not debar the Customs Authorities from suspending the petitioner's licence under section 13(4) during the pendency of such proceedings if the facts and investigations into the matter so warrant.
17. ' We had also directed the respondents vide order dated 1-9-1998 to allow clearance of the petitioner's goods for inbonding into their warehouse. As we have concluded that the impugned order is not warranted in law, we also direct the respondents to issue the necessary Delayed Detention Certificate to the petitioner so that they may be able to recover any demurrage already paid and not incur further demurrage on their goods at Karachi Port.
18. ' Order accordingly.
19. ' MRS. MAJIDA RAZVI, J.--I agree.