MUHAMMAD MUJEEBULLAH SIDDIQUI, J.--In this petition under Article 199 of the Constitution of Islamic Republic.. Of Pakistan, 1973, the petitioner has sought the following relief..
"(a) That the Detention Notice No,SI/Musc/217/86-AIB, dated 7-1-1992 issued by the respondent No,2 and annexed with the petition as Annexure P.5 may please be declared as illegal, void, without lawful authority and of no consequence as such.
(b) Directing the respondents to restore the ex-bonding and in-bonding facilities available to the petitioner which have been illegally suspended in view of the detention order dated 7-1-1992 referred to hereinabove."
2. Briefly stated the facts giving rise to this petition, as contained in the memo of petition, are that the petitioner a Private Limited Company imported Machinary and Equipments against the Import Licence granted by the Government of Pakistan from Italy, which arrived at Karachi on 14-10-1986.
On the same day the petitioner filed the Bill of Entry showing the classification of goods under P.T.C.
No,84.59-D03 having rate of duty of 20% ad valorem. According to petitioner, similar machinery was imported in the year 1985 also and was classified under the same head, without any objection and was released by the Customs Authorities. In respect of imports which is the subject-matter of this petition, the classification given by the petitioner was not accepted and the respondent No,2, questioned the correctness of the P.T.C. Heading and classified the same under the head 84.47B, assessable at the rate of 80% ad valorem. At the time of release of the said machinery, provisional assessm ent was made and the goods were released against the payment of 20% ad valorem and the remaining 60% of the duty was to be paid after determination, if additional 60% by way of regulatory duty was payable or not. The petitioner was required to furnish Insurance Guarantee for the rest of the amount of duty which was valid for a period of one year. On 1-3-1987 the respondent No,2 informed the Insurance Company and the petitioner that the correct PCT heading has been determined as 84.47B and therefore the amount of guarantee stands adjusted against the duty so found payable. The Insurance Company was directed to pay the said amount within 10 days from the date of issuance of the letter failing which action under section 202 of the Customs Act, 1969 was threatened to be initiated. However, from 1-3-1987 till 12th of January, 1992 no action was taken and/or, no show-cause notice demanding the amount of duty so determined and recoverable from the petitioner was issued. It is contended in the memo. Of petition that such notice was required to be issued by virtue of provision contained in section 32 of the Customs Act. Due to non- compliance of show-cause notice under section 32 the demand became totally barred by time. It is further stated that on 7th of January, 1992 the respondent No,2 issued instructions to the Private Bond, where the goods of the petitioner valued about Rs,45,19,083 were warehoused, to auction the same and to withhold the clearance of consignments imported by the petitioner for the purpose of recovery of Rs,9,84,459. The bonded warehouse refused to give delivery of the raw material of the petitioner lying in the bonded warehouse. Hence this petition.
3. In the grounds of appeal, it is stated that the correct head of PTC in respect of machinery imported by the petitioner is 84.59 DO3 and not PTC 84.47B. It is further contended that the recovery has become barred by time for want of notice under section 32 of the Customs Act.
4. A perusal of the order sheet dated 25-2-1992, shows that the respondents were directed to detain the goods of petitioner to the extent of the claim of the Customs Authority, while the balance goods were directed to be cleared in accordance with law.
5. We have heard Mr. Sher Afghan, learned counsel for the petitioner and Mr. Raja Muhammad Iqbal, learned counsel for the respondents.
6. The sole contention of Mr. Sher Afghan, is that the respondents have not issued show-cause notice under section 32 and consequently, the impugned notice dated 7-1-1992 under section 202 of the Customs Act, 1969 is bad in law, and the period of limitation provided in section 32 of the Customs Act, 1969 has expired, therefore, the recovery of the demand is barred by time. In support of his contention, he has placed reliance on the following judgments:
(1) Assistant Collector Customs v. Khyber Electric Lamps Manufacturing Company 2001 SCM R 838.
(2) M/s. Said Ghani v. The Central Board of Revenue, Government of Pakistan 1990 CLC 511 (Karachi).
7. On the other hand Mr. Raja Muhammad Iqbal, learned counsel for the respondents has submitted that in the facts and circumstances of the case, no notice was required to be issued under section 32, as the department has not initiated any action to enhance the custom duty already determined. He has submitted that the admitted position is that initially a provisional assessm ent was made under section 81 of the Customs Act, 1969 and subsequently within the period of limitation final assessm ent was made under section 80 of the Customs Act, intimation whereof was given to the petitioner through letter dated 1-3-1987. The petitioner did not prefer any appeal against the final assessm ent order in which the correct PTC heading was determined as 84.47B. With the non-filing of appeal within the period of limitation, the final assessment order under section 80 of the Customs Act attained finality. The demand remained outstanding for several years and by the impugned letter dated 7-1-1992, recovery proceedings were initiated under section 202 of the Customs Act, 1969. He has submitted that no period of limitation has been provided for initiation of recovery proceedings under section 202 of the Customs Act, 1969 and therefore, the question of recovery of demand becoming barred by time does not arise.
8. We asked Mr. Sher Afghan, if any appeal was preferred by the petitioner against the final assessm ent order under section 80 of the Customs Act, which was intimated to the petitioner vide letter dated 1-3-1987, Annexure P.4 with the petition, to which he has replied in negative. He has submitted that the non-filing of appeal shall not affect the maintainability of the petition as the remedy of appeal/revision was mere illusory in nature. In support of his contention, he has placed reliance on the judgment in the case of Collector of Customs v. M/s. S.M. Ahmed & Company (Pvt.)
Limited 1999 SCM R 138.
9. We further asked Mr. Sher Afghan, learned counsel for the petitioner if any period of limitation was provided for initiation of recovery proceedings under section 202, to which he replied in negative.
10. In order to appreciate the first contention of Mr. Sher Afghan, it would be appropriate to reproduce section 32 of the Customs Act, which reads as follows: "32. Untrue statement, error, etc.--(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
(b) 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, [Knowing or having reason to believe that such document or statement is false] in any material particular, he shall be guilty of an offence under this section.
(2) Where, by reason of any such document or statement as aforesaid or by reason of some collusion, any duty or charge has not been levied or has been short-levied or has been erroneously refunded, the person liable to pay any amount on that account shall be served with a notice within five years of the relevant date, requiring him to show cause why he should not pay the amount specified in the notice.
(3) Where, by reason of any inadvertence, error or misconstruction, any duty or charge has not been levied or has been short-levied or has been erroneously refunded, the person liable to pay any amount on that account shall be served with a notice within three years of the relevant date requiring him to show cause why he should not pay the amount specified in the notice.
(3A) Notwithstanding anything contained in subsection (3), where any duty or charge has not been levied or has been short-levied or has been erroneously refunded and this is discovered as a result of an audit or examination of an importer's accounts or by any means other than an examination of the documents provided by the importer at the time the goods were imported, the person liable to pay any amount on that account shall be served with a notice within three years of the relevant date requiring him to show cause why he should not pay the amount specified in the notice.
(4) The appropriate officer after considering the representation, if any, of such person as is referred to in subsection (2) or subsection (3) shall determine the amount of duty payable by him which shall in no case exceed the amount specified in the notice, and such person shall pay the amount so determined.
(5) For the purposes of this section, the expression "relevant date" means--
(a) in any case where duty is not levied, the date on which an order for the clearance of goods is made;
(b) in case where duty is provisionally assessed under section 81, the date of adjustment of duty after its final assessm ent;
(c) in a case where duty has been erroneously refunded, the date of its refund;
(d) in any other case, the date of payment of duty or charge."
11. A bare perusal of the above section shows that it pertains to non-levy of duty or charge or short- levy or erroneous refund and is not applicable to the recovery of proceedings under section 202 of the Customs Act, 1969 in respect of a demand created as a result of original assessment. As is evident from the narration of facts in earlier part of this judgment, a provisional assessment was made under section 81 and thereafter, within the period of limitation, a final assessment was made under section 80 of the Customs Act and the department has neither alleged that there was any case of non-levy of duty/charge or short-levy, therefore, the contention that notice under section 32 was required to be issued is totally misplaced. The judgments in this behalf on which Mr. Sher Afghan has placed reliance are not required to be considered for the simple reason that the said judgments deal with the situation where a demand has been created as a result of initiation of proceedings on account of alleged non-levy or short-levy of duty/charge or erroneous refund. As Mr. Sher Afghan has conceded that no period of limitation is provided for initiation of recovery proceedings under section 202 of the Customs Act, are of the considered opinion that the entire edifice of arguments built-up by Mr. Sher Afghan, is totally misplaced and is without substance. The contention is hereby repelled.
12. The second contention, that the final assessment order dated 1-3-1987 was not challenged in appeal because the remedy provided in appeal/revision was illusory in nature, is also without any force. The facts of the case reported as 1999 SCM R 138 (supra) were totally different. The Hon'ble Supreme Court made observation, that the contention, that the Constitution Petition was not maintainable as respondent had an alternate remedy by way of Appeal/Revision under section 196 of the Customs Act, 1969 which was non-exhausted, was not tenable in the facts and circumstances of the case, where the Central Board of Revenue which is the highest body in the hierarchy of tax administration had already expressed its opinion against the assessee. In the present case no such circumstances exist and therefore, the ratio of the judgment of the Hon'ble Supreme Court in the case of Collector of Customs v. M/s. S.M. Ahmed, 1999 SCM R 138 is not attracted.
13. There is another ground for rejecting the plea that the validity of the assessment order be determined in this petition. The final assessment order was made on 1-3-1987 and admittedly the intimation was sent to the petitioner but neither he filed any appeal against the said order nor assailed the final assessm ent order in the petition till initiation of recovery proceedings under section 202 Customs Act, in January, 1992. This petition was presented in the High Court on 9-2- 1992 and therefore, it suffers from lathes. The assessment order cannot be allowed to be assailed in this petition, with the result that the assessment order attained finality, which is in the field. In the presence of an assessm ent order which attained finality, no exception can be taken to the initiation of recovery of Government dues.
14. For the foregoing reasons, it is held that the petition is without substance which stands dismissed accordingly.