ZUBAIR WALI AHMED ZIA LTD. VS The PRINCIPAL APPRAISER, 2016 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 2463 (2016)

2016 P T D (Trib.) 2463

[Customs Appellate Tribunal]

Before Tahir Zia, Member (Judicial-II)

Messrs ZUBAIR WALI AHMED ZIA LTD. and another

Versus

The PRINCIPAL APPRAISER and others

Customs Appeals Nos. K-1310 and K-1311 of 2015, decided on 13/04/2016.

(a) Customs Act (IV of 1969)---

----Ss. 1(2), 2(s), 25, 25-A, 30, 32, 73, 79, 121, 129, 156, 168, 181, 207, 208, 209 & First Schedule---Customs Rules, 2001, Rr. 110, 473(6) & Ch. XXI, Sub. Ch.VII---Sales Tax Act (VII of 1990), Ss. 6, 11, 30, 33, 34 & 48---Income Tax Ordinance (XLIX of 2001), Ss. 48, 140, 148, 162, 207 & 228 to 230-A---Revised Koyoto Convention (1999)---S.R.O. No.151(I)/2004 dated 10.03.2004---S.R.O. No.886(I)/2012 dated 18.07.2012---Transit trade---Goods declaration---Classification of goods--- Procedure--- Insurance guarantee---Necessity---Clearing agent---Liability---Scope---Importer, in the present case, was a citizen of Afghanistan and was duly registered as an importer with the Ministry of Commerce and Industry of Afghanistan under the Trade license for importing goods for home consumption in Afghanistan at Karachi for transit to the place of business in Afghanistan under Afghan Pakistan Transit Trade Agreement, 2010 (APTTA)---Any discrepancy found in the import documents submitted for transit of the goods or in the goods thus imported had to be reported by the Director General of Transit Trade (DGTT) to the Ministry of Commerce and Trade of Afghanistan (MOCA) through the Ministry of Commerce, Pakistan and subsequently a complaint under para 2 of Art. 3 of S. II of APTTA had to be filed before the Afghanistan Pakistan Transit Trade Co-ordination Authority under Art. 34 of Section S. X of APTTA, as under the provisions of Customs Act, 1969, the officials of Customs were not empowered to proceed---Customs Act, 1969, being neither applicable in Afghanistan nor on the citizens of Afghanistan, was not applicable to the appellant, and the department had no locus standi to serve impugned show cause notice to him--- Word 'mis-declaration' was alien to Revised Kyoto Convention, 1999, Afghan Pakistan Transit Trade Agreement, 2010 and Sub-Chapter VII of Chapter XXI of Customs Rules, 2001---Importer of Afghanistan, transmitting goods declaration under WeBOC regime, narrated the tentative facts of the goods stuffed in container that could be varied in description, quantity, quality and weight, which was curable through an amendment, and if the same was not possible, the importer could have been asked to submit additional insurance guarantee for the amount of leviable duty and taxes on the value determined under S. 25 or 25-A of Customs Act, 1969 for home consumption under S. 79(1) of the Act---Use of the word 'mis-declaration' in the impugned show cause notice and Order-in-Original was out of context besides the same being based on mis-conception, as the provisions of Customs Act, 1969 were not applicable to said goods---Goods, in the present case, having been allowed "gate-out", could not have been allowed to "gate in", nor could the same have been stopped under any apprehension, as the customs Officials, after clearance of the goods and removal of the consignment from the customs area, had become functus officio to reopen the case again, which had become past and closed transaction---Impugned show cause notice had been issued after expiry of the initial period of two months, without any extension by the Collector prior to expiry of the initial period after serving a notice to the appellants and recording of exceptional circumstances and reasons in writing---Impugned show cause notice being barred by 22 days, was without power or jurisdiction and lawful authority---Sections 33 & 34 of the Act could not have been invoked in the impugned show cause notice in isolation, unless the charging section was invoked and by the authority competent to do that---Incorporation of the irrelevant sections rendered the impugned show cause notice and Order-in-Original void ab initio and of no legal effect---Additional Collector of Customs, under said sections, was not empowered to exercise powers under the charging S. 11 of Sales Tax Act, 1990 and S. 162(1) of Income Tax Ordinance, 2001---Department had no power to recover the arrears of the taxes on their own, unless they were in receipt of notice from the Officer of Inland Revenue and Commission of Income Tax under Ss. 48 & 140 of Income Tax Ordinance, 2001---Impugned adjudication proceedings under S. 11 of Sales Tax Act, 1990 and S. 148 of Income Tax Ordinance, 2001 were, therefore, not legal and justifiable---Initiation of legal proceedings in case of discrepancy against the importer of Afghanistan through his clearing agent rested with Principal Appraiser of the DGTT, who was to take cognizance of the discrepancy found in the documents and the goods during the course of examination, and in case of need, he was competent to issue show cause notice himself to the clearing agent of the importer of Afghanistan for seeking justification for the found discrepancy or pass an observation for preparation of complaint for submission with the Ministry of Commerce of Pakistan for its onward submission with the Ministry of Commerce of Industry of Afghanistan for placing it before Afghanistan Pakistan Co-ordination Authority in terms of para 2 of Art. 3 of Afghanistan Pakistan Transit Trade Agreement, 2010---Principal Appraiser, in the present case, took cognizance of the issue, instead of proceeding himself inspite of being competent, had opted to frame contravention report instead of complaint and transmitted the same to the respondent/Additional Collector of Customs, who issued impugned show cause notice and subsequently passed order in the capacity of Principal Appraiser, to which he was not empowered being an Additional Collector---Additional Collector was not even empowered to adjudicate the cases where there was technical violation of import and export having no revenue loss---Superior Officer was not empowered to exercise quasi judicial powers of his subordinate in the matter of adjudication---Impugned show case notice, not having been issued by the authority defined in R. 473(6), proviso of Chapter VII of Customs Rules, 2001, was without jurisdiction and void ab initio---Goods Declaration of Transit Trade did not fall within the ambit of the phrase 'any other approved purpose'; hence, the same was outside of the ambit of S. 79(1) of Customs Act, 1969---Department had presumed the classification of the said goods as being auto parts on the basis of presumption without disclosing the appropriate H.S. Code or evidence under which the impugned goods could have been classified as auto parts---Opinion and findings of the department with regard to the impugned goods were without any substance due to the fact that auto parts and accessories fell within the ambit of headings 87.01 to 87.08, and none of the sub-heading subsequent to 87.08 expressed nuts and bolts as motor parts---Nuts and bolts imported by the appellant, therefore, did not fall within the ambit of auto part---None of the Customs Authorities operating at Karachi for clearance of the imported goods and Enforcement and even Directorate General of Intelligence and Investigation of the Federal Board of Revenue were empowered either to hold or detain or examine the goods meant for transshipment under the S. 121 of Customs Act, 1969, which was synonymous to S. 129 of the Act---Goods, in the present case, were meant for transit to Afghanistan were subject to submission of insurance guarantee to the extent of the amount of duty and taxes leviable thereon under 1st Schedule to the Customs Act, 1969 returnable after cancellation upon receipt of confirmation to the effect that the goods had been crossed the border---Confiscation and detention of the goods were, therefore, declared without lawful authority---Charges against the appellant/clearing agent were wholly misconceived, as his action did not fall within the operative mechanism of S. 32 of the Act---Liability of the appellant/Clearing Agent during the course of clearance of the consignment had to be evaluated under the provisions of Ss. 207, 208 & 209 of Customs Act, 1969, which indicated that an agent represented his principal and until and unless any direct evidence was attributed against him or when the department was not able to prove any criminal intent on his part, he could not have been penalized under the general provisions of Customs Act, 1969, unless, he violated the governing condition of his license---Clearing agent could not be presumed to be privy to any illegal arrangement, which the importer might have coined or had intended in his mind, and for that purpose some evidence of his direct involvement would have to be brought on record, particularly, when the clearing agent was not shown to have been directly or indirectly a beneficiary of evasion of taxes/duties---Customs Appellate Tribunal, vacating the impugned show cause notice and setting aside the orders-in-original passed thereon, being illegal, void ab initio, directed the department to allow transit of the goods shown and found in the Goods Declaration upon securing insurance guarantee---Principles.

Case-law referred.

(b) Words and phrases---

----'Discrepancy'----Definition and scope.

Case-law referred.

(c) Administration of justice---

----Things should be done as or required to be done and not at all.

Case-law referred.

Nadeem Ahmed Mirza, Mirza Muhammad Abeer (Consultants) and Obaydullah Mirza for Appellants.

Jam Muhammad Akram, Appraiser for Respondents.

Date of hearing: 8th January, 2016.

JUDGMENT

TAHIR ZIA, MEMBER (JUDICIAL-II)---Through this common order, I intend to dispose of two (02) Appeals bearing Nos. K-1310 and 1311/2015 filed against Order-in-Original No.137/2015-16 dated 13.08.2015 passed by Additional Collector of Customs, Adjudication-II (hereinafter to be referred as respondent No.2) in the capacity of Principal Appraiser.

2.Since, these 02 appeals are of importer of Afghanistan and Clearing Agent operating in Karachi and are based on similar facts and questions of law, therefore it is needless to reproduce facts of each case separately. Hence, being heard and dealt with and disposed off simultaneously through this common order in the light of the judgment of the honourable High Court of Sindh in Customs Reference No.157 of 2008, S.M. Naqi son of Syed Muhammad Hussain, Karachi v. Collector of Customs (Adj-I) and others. For reference the facts of Appeal No. K 1310/2015 as reported by the Principal Appraiser, Directorate General of Transit Trade (herein after to be referred as respondent No.1) are taken into consideration, the appellant is a importing company and is registered with the Ministry of Commerce and Industry of Afghanistan (MOCA) in the said capacity, during the course of his business activities he imported a consignment of 1532 cartons, comprising of 96945 pcs stuffed in 1 x 40" container bearing No. PCIU8563551 of different items/articles namely. Slippers, shoes, radio and nails amounting to $. 6682.00 C&F Karachi in transit to Afghanistan against invoice No. Zz-252-2015 dated 23.03.2015 and B/L No. NKHI15620358 dated 23.03.2015. Upon receipt of documents from the shipper, he delivered those to his clearing agent M/s Akmal Rafay International, Karachi (CHAL No. 2456) for transmitting Goods Declaration (hereinafter to be referred as GD) in transit under the provision of section 129 of the Customs Act, 1969 and Rule 472 of Sub-Chapter VII of Chapter XXI of Customs Rules, 2001 inserted in the Customs Rules through S.R.O. 121(I)/2014 dated 24.02.2014, with the Directorate General of Transit Trade (hereinafter be referred as DGTT) which he did on the strength of the documents supplied to him by the appellant. The information so transmitted was accepted and DGTT allotted number ITTK-AT -24068 on 08.04.2015 to the GD. After receipt of which on his desktop, the Appraiser concerned processed the Good Declaration under rule 473 and communicated the amount of Insurance Guarantee equivalent to leviable duty and taxes on the goods if cleared for home consumption under section 79(1) of the Customs Act, 1969. Which was submitted by the appellant and was found correct and therefore the Goods Declaration was out of charge of the customs control. The GD was subsequently assigned to carrier and the nominated official of DGTT fed the carrier information comprising of truck number, driver name and other particulars. The container along with carrier was subsequently presented to Customs Computerized Sealing Unit (CCSU), which affixed the seal on the container and fed the said effect along with other information in the system in terms of Sub-Rule (7) of Rule 473 ibid. Thereafter, the sealing staff verified the installation of the gadgets, inclusive of seal and uploaded the images of the "seal", "tracking devise", "vehicle" and "container in the system and generated the transport note on the prescribed format and handed over to the carrier, each copy of which was signed by the custom sealing staff and copy of which was handed over to the driver for submitting to the gate-in staff. The terminal operator and the custom office staff thereafter allowed gate out of the consignment as expressed in Sub-Rules (8) and (9) of Rule 473 ibid, while doing so the Terminal Operator also entered the weight of the container at the time of "gate-out" for onward communication to the computerized system through EDI in terms of Sub-Rule (10) ibid., and the vehicle accordingly proceeded to its destination. That when the driver of the carrier was having tea in a hotel at Kathore, the Officials of DGTT intercepted it and brought it back to the terminal on the pretext that they had certain information in regards to description and quantity. The container thereafter was gate-in and re-examined, which transpired that the item available in the consignment are 17 in numbers as against 4, including Benz wheel Bolt, which are not allowed to import it for transit to Afghanistan under SRO 151(I)/2004 dated 10.03.2004. The respondent No.1, thereafter feed the goods and served notice under sections 158(1) and 171 of the Customs Act, 1969 on the appellant No.2. Subsequently, the respondent No. 1 framed contravention report and forwarded to respondent No. 2 stating inter alia that the appellant has mis-declared the quantity and description of the goods and as such he committed an offence of smuggling attracting 2(s) and an act of mis-declaration and as such has contravened the provision of sections 2(s), 16, 32A(1), 127, 128, 129, 192 and 209 of the Customs Act, 1969, section 3(I) of Import and Export Control Act, 1950 and Import Policy and Procedure Order in addition to sections 3, 6 and 11 of the Sales Tax Act, 1990 and section 148 of the Income Tax Ordinance, 2001, punishable under clauses 8, 9, 14, 14(A), 63,64 of section 156(1) of the Customs Act, 1969 and sections 33 and 34 of the Sales Tax Act, 1990 and section 148 of the Income Tax Ordinance, 2001. The respondent No.2 as reported by respondent No. 1 issued show cause notice dated 10.03.2014 to the appellant. The appellant submitted reply to the show cause notice dated 24.07.2015, on which comments by respondent No. 1 were submitted, controverted by the consultant, vide letter dated 05.08.2015. The reply and additional arguments failed to find acceptance of respondent No. 2 and he passed order dated 13.08.2015 paras 10 to 15 are relevant which are reproduced here in below for easement:

10- I have gone through the case record and considered the verbal/written submission put forth by the respondent. The case of the department is that M/s. Zubair Wali Ahmed Zai Ltd., Sarak-e-Koh Television Market, Shah Mahmood Khan, Kabul, Afghanistan based importer had filed a goods declaration bearing GD No. ITTK-AT 24068-08042015 to through their authorized clearing agent M/s. Akmal Rafay (Pvt.) Ltd., CHAL 2456, Karachi vide Import General Manifest (IGM) No. 123 dated 09.04.2015, Index No. 346, B/L No. NKHI15620358 (1x40") container No. PCIU-8563551. Seeking clearance of the following items.

(i)Slippers

(ii)Radio

(iii)Shoes

(iv)Nail.

11.Later on, in pursuance of a credible information the container was intercepted by the staff of the Directorate General of Transit Trade, Karachi on Super Highway and brought back to East Wharf, Karachi Detailed examination of the consignment was made and the following items were found as against the declared items as stated above.

Declared Items	Undeclared Items
(i) Slippers (ii) Radio (iii) Shoes (iv) Nail	(i) Electric Calculator (ii) Mega Phone (iii) LED Display (iv) Mens Vest (v) Cable Jointer (vi) TV Back Cable Pin (vii) Co-Axial cable (viii) Floor Hinge (ix) School Bags (x) Electric Cutting Machine (xi) Electric Plug (xii) Benz Wheel Bolt (xiii) Magnet

12.Accordingly, the case was referred for adjudication wherein the value for the un-declared item has been reported as Rs. 47,41,836/- involving duty and taxes of Rs. 27,93,439.00 the counsel for the respondent has raised legal/factual objection which can be summarized as follows:

a.This forum lack jurisdiction to adjudicate the case in terms of SRO 886(I)/2013 dated 18.07.2012.

b.The show cause notice has to be issued by the Learned Collector instead of this office as the amount involved is Rs. 5,413,139.00, which falls within the jurisdiction of Collector as per provisions of section 179 of the Customs Act, 1969.

c.Provisions of section 32 of the Customs Act, 1969 are not attracted.

13. The above referred issues are analyzed to the light of law and rules as under:

a.This forum lacks jurisdiction to adjudicate the case in terms of SRO 886(I)/2012 dated 18.07.2012.

Perusal of the case record and examination report reflects that it is not a case of technical violation but a case mis-declaration of description having revenue implication. Provision of section 32 of the Customs Act, 1969 have been invoked in the show cause notice besides as pointed out by the Directorate of Transit Trade duty and taxes amounting to Rs. 27,93,439.00 are involved. Thus, the objection raised by the counsel is not tenable.

b.The show cause notice has to be issued by the learned Collector instead of this office as the amount of duty and taxes involved is Rs. 54,13,139.00, which fall within the jurisdiction of Collector as per section 179 of the Customs Act, 1969.

The counsel of the respondent has raised legal objection in respect of assumption of jurisdiction by this forum on the pretext that the total amount of duty and taxes involved is Rs. 54,13,139.00, it has been observed that the department has referred the case for adjudication in respect of mis-declared banned items and has not included the value/duty and taxes involved in respect of the declared item. The amount of duty/taxes involved in respect of mis-declared item are Rs. 27,93,439.00 which falls within the jurisdiction of this forum. Furthermore, it will be appropriate to examine the provision of section 179 of the Customs Act, 1969. For reference the same is reproduced here-in-under:

"179. Power of Adjudication: Subject to subsection (2) in cases involving confiscation of good or recovery of duty and other taxes not levied short levied or erroneous refunded, imposition of penalty or any other contravention under this Act or the Rules made there-under , the jurisdiction and power of the officer of Customs in terms of amount of duty and taxes involved excluding the conveyance, shall be as follows.....

Since the duty and taxes not levied in this case have been reported by the Directorate General of Transit Trade reported as Rs. 27,93,439/-, which fall within the monitory limit of this forum.

c.Provision of section 32 of the Customs Act, 1969 are not attracted

A bare perusal of examination report reveals that the importer has mis-declared the contents of the consignments, the provision of section 32 of the Customs Act, 1969 are attracted and have been correctly invoked. Further more, the arguments of the respondent that the GD for transit is filed under section 129 of the Customs Act, 1969 and not section 79 of the Customs Act, 1969 is incorrect.

It will be appropriate to examine the provision of both sections:

79. Declaration and Assessment for home consumption and warehousing:- (1) The owner of any imported goods shall make entry of such goods for home consumption or warehousing or for any other approved purposes within 15 days of the arrival of the goods by,--

129 Transit goods across Pakistan to a foreign territory:- Where any goods are entered for transit across Pakistan to a destination outside Pakistan, the appropriate officer may, subject to the provisions of the rules, 'allow the goods to be so transited without payment of the duties which would otherwise be chargeable on such goods."

Provided that the Federal government may, by notification in the Official Gazette prohibit the bringing into Pakistan by Sea, land or air in transit to a foreign territory any goods or class of goods.

It is clear that section 79(1) requires the owner of any imported goods to make entry for:-

(a)Home consumption

(b)Warehousing

(c)Any other approved purpose.

Thus, the goods declaration filed for Transit falls under "any other approved purpose". Section 129 only empower the Officer of the Transit Trade to process the goods declaration in the light of relevant rules.

Since the importer clearing agent has failed to discharge the liability by filing a true and correct declaration as required under section 79 of the Customs Act, 1969, furthermore, the counsel has argued that since no duty/taxes are involved, section 32 of the Customs Act, 1969 cannot be invoked. This contention is also in correct since the transit goods, duty/taxes are levied, however, the same are not paid sine the levy exist as per provision of Customs Act, 1969 read with Rules provision section 32 are attracted.

14.It has been observed that the clearing agent has also failed to discharged his liability by filing an incorrect declaration of the goods further more item No. (xii) Benz wheel Bolt being autopart are not importable in terms of SRO 151(I)/2014 dated 10.03.2014, the authorized representative has contested that these are ordinary nuts/bolts, whereas the departmental representative has produced literature/photograph which clearly depict that the same are Mercedes Benz Wheel Bolts and Nuts. Accordingly, the same are not allowed to be imported under SRO 151(I)/2014 dated 10.03.2014. In addition the departmental representative has submitted that the same are specifically mentioned as nuts/bolts of vehicle in Chapter 73 of the Pakistan Customs Tariff.

15.In the light of afore stated facts, the charges leveled in the show cause notice stands established. In exercise of the powers conferred upon me under section 156(1)(14) of the Customs Act, 1969, I order for confiscation of undeclared item i.e. (i) electronic calculator, (ii) Mega Phone, (iii) LED Display (iv) Men's Vest, (v) Cable Jointer, (vi) TV Back Cable Pin, (vii) Co-axial Cable, (viii) Floor Hinge (ix) school bags (x) Electric cutting Machine (xi) Electric Plug (xii) Magnet (xiii) whereas item No. (xiii) Benz Wheel Bolt is outrightly confiscated for violation of Rules 473 and 484Q of SRO 121(I)/2014 dated 24.02.2014 and SRO 151(I)/2004 dated 10.03.2004 read with sections 16, 32(1), 32A(1), 127, 128, 129, 192 and 209 of Customs Act, 1969. Section 3(i) of Imports and Exports (Control) Act, 1950 and Import Policy and Procedure Order in vogue. Sections 3, 6 and 11 of the Sales Tax Act, 1990 and section 148 of the Income Tax Ordinance, 2001. However, the importer is given an option to redeem the same (excluding item No. xii Mercedes Benz Wheel Bolt that has been out-rightly confiscated). On furnishing of customs security as per Afghan Transit Trade Rule in respect of undeclared item and payment of redemption fine equivalent to 35% of the value of the undeclared item (offending goods) in terms of clause (1C) of SRO 499(I)/2009 dated 13.06.2009 read with section 181 of the Customs Act, 1969 subject to the condition that the same are otherwise importable under relevant provision of the Transit Trade Rules and legal provision of the Act. Provision of Law a penalty of Rs. 300,000/- (Rs. three hundred thousand only), is imposed on the importer for mis-declaration of description, under section 156(1)(14) of the Customs Act, 1969. A penalty of Rs. 25,000/- (Rs. Twenty Five thousand only) is imposed on the clearing agent) M/s. Akmal Rafay International, clearing agent office. (CHAL 2456) Karachi for active connivance with the importer under section 156(1)(14) of the Customs Act, 1969.

3.Being aggrieved and dissatisfied with the impugned Orders-in-original the appellant No. 1 filed the appeal before this Tribunal on the ground incorporated in the Memo of Appeal, on the date of hearing Mr. Nadeem Ahmed Mirza Consultants appeared and contended that:

(i)That for obtaining WeBOC user ID for filing transit trade GD with the DGTT, by the importer/trader of Afghanistan as expressed in Rule 424 of Sub-Chapter II of Chapter XXI of Customs Rules, 2001, an application has to be filed by him with the Ministry of Commerce and Industry of Afghanistan (MOCA), annexed with the documents prescribed therein by the Pakistan Customs, which after scrutinizing of those, register him under Rule 424 and allocate him unique user identification under Rule 427, to which MOCA has been authorized by the Pakistan Customs to create user IDs of the Afghan traders. Subsequent to that, the nominated officer of MOCA, to whom a specific user ID has been allocated by the Pakistan Customs for the said purpose for logging in the software of WeBOC, intimate the allocated unique user identification to the Assistant Collector (MIS) of the Collectorate of Appraisement (East) along with user ID of the trader and form submitted for the said purpose on the registered email address. This confirms that Pakistan Customs/DGTT has no interaction with the trader of Afghanistan right from registration with WeBOC, till filing of GD for home consumption at the Dry port of Afghanistan for clearance of the goods imported by a trader of Afghanistan in Karachi for transit to Afghanistan, for levy of duty and taxes as prescribed in the Afghanistan Customs Tariff, by the Custom department of the Government of Afghanistan, any contravention of the Afghanistan Customs Act/Afghanistan Customs Tariff, rest with the Government of the Islamic Republic of Afghanistan and none else, respondents are no exception.

(ii)That the respondent No. 2 has issued show cause notice to the appellant, who is operating in the Islamic Republic of Afghanistan without consulting to the instruments, through which Transit Trade is governed, namely (i) Revised Kyoto Convention Agreement 1999 (ii) Afghan Pakistan Transit Trade Agreement, 2010 (APTTA) (iii) Notification S.R.O. No.121(I)/2014 24.02.2014 and even the Customs Act, 1969 Preliminary of section 1 of Chapter, read as "short title, extend and commencement" and clause (1) says as "This Act may be called the Customs Act, 1969 and Clause (2) as "it extent to the whole of Pakistan" The appellant failed to find any phrase, Article, condition and Rule, inclusive of Customs Act, empowering the respondent No. 2 to issue show cause notice to an Importer/Trader of Afghanistan and this is due to the fact that they are non entity, stood validated from clause (2) of the Act, which says it is applicable to the extent of whole of Pakistan not beyond that. Meaning thereby that Customs Act is not applicable on the importer of Afghanistan. Hence, the respondent No. 2 has no mandate to issue show cause notice to an importer of Afghanistan. It is for the Custom Officials of the Government of Islamic Republic of Afghanistan to proceed against the appellant under the Customs Act of Afghanistan after receipt of report, contrary to declaration from the Officials of DGTT along with import documents and Goods Declaration, copies of the same had to be dispatched separately by courier through Ministry of Commerce of Pakistan to Ministry of Commerce and Industries of Afghanistan (MOCA) for information and proceeding by the Revenue division of Afghanistan. Acting in derogation of Section 1 the Customs Act, 1969. Render the act of respondent No. 2 without lawful authority/jurisdiction by virtue of having no locus standi. Hence, void and ab initio.

(iii)That upon conclusion of transaction under the provision of section 129 of the Customs Act, 1969 and Rules 473 to 476 of Notification No. 121(I)/2014 dated 24.02.2014, it became past and closed transaction. The consignment so out of charge after obtaining insurance guarantee cannot be subject to re-examination, detention, seizure for the purpose of adjudication, by virtue of the fact that the Officer who allowed the gate out and the preceding formalities became functus officio. In the instant case of appellant the Customs Codal Formalities were completed under Rules 472 to 474 ibid and the goods were out of charged and the consignment was gate out. The official of DG T&T intercepted the carrier at Kathore, Super highway and brought it back to the terminal, which is a blatant illegal act, as none of the Article of APTTA, 2010 and Rules embodied in Notification No. 121(I)/2014 dated 24.02.2014 empowers them to do so, rendering the detention under section 186, Seizure under section 168(1), issuance of show cause notice under section 180 while assuming power under section 179 of the Customs Act, 1969 inspite not applicable as abuse of power. Since, the goods of appellant were gate out, resultant the respondent became fictitious as held in reported judgment 2008 PTD 1968 M/s. Sikander Enterprises v. Central Excise and Sales Tax Tribunal Karachi.

(iv)The subordinate of respondent No. 1 intercepted the consignment of appellant at Kathore at 18 hours on 16.04.2015 and put an hold for proceeding to destination. Such hold tantamount to notional seizure as held by High Court of Sindh in reported judgment 2003 PTD 2821 Syed Muhammad Razi v. Collector of Customs (Appraisement), Karachi and 2 others. By virtue of notional seizure the provision contained in sections 171 and 168(1) of the Customs Act, came into operation. Meaning thereby in the case of seizure of goods under section 168 the reason are to be recorded under section 171 and communicated to the person from whose possession the things are seized and the notice under section 180 of the Customs Act, 1969 by the authorities vested with the powers under section 179 ibid is also required to be issued within 2 months of the seizure of the goods subject to extension for further two months based on exceptional circumstances by the Collector of Customs after giving notice to the respective person as per law laid down by the Supreme Court of Pakistan in reported judgment 1999 SCMR 1881 Khalid Mahmood v. Collector of Customs, Custom House, Lahore and recording of those exceptional circumstances, failing to which the owner or the person from whose possession they were seized earn a right for the return of the goods and the order/act of seizure become illegal and invalid.

(vi)That in the instant case of the appellant the initial period of 2 months stood lapsed on 15.06.2015 from the notional seizure dated 16.04.2015 and the show cause notice by the Respondent No. 2 has been issued on 07.07.2015, no extension granted by the competent authority due to the fact that no exceptional circumstance were available with him. Rendering the show cause notice time barred and as such without powers/jurisdiction and the order so passed is as well void and ab initio as held by Superior Court in umpteenth judgment e.g. 1998 MLD 650, 2005 PTD 23, 2003 PTD 2821 and 2007 PTD 2092.

(vii)That in the show cause notice section 33 of the Sales Tax Act, 1990 and section 148 of the Income Tax Ordinance, 2001 have been invoked without realizing to the fact that section 33 is not a charging section instead a penal synonymous to section 156(1) of the Customs Act, 1969 and section 148 is equally not a charging section instead inserted in the Ordinance empowering the officer of Customs, to collect the leviable income tax at import stage. No show cause notice can be issued under the said sections, rendering the show cause notice and order- in-original void and ab initio and of no legal effect as held in reported judgment judgments Asst. Collector v. Khyber Elec. Lamps 2003 PTD 1275, D. G. Khan Cement v. Collector of Customs 2005 PTD 480, Caltex v. Collector 2003 PTD 1593, Union Playing Card Company v. Collector of Customs 2002 MLD 130, Atlas Tyres v. Additional Collector 2002 MLD 180, State Cement v. Collector PTCL 2001 CL 558, Kashmir Sugar v. Collector 1992 SCMR 1898, Rose Color v. Chairman, CBR and 2013 PTD 813 Sarwar International v. Additional Collector of Customs.

(viii) That even otherwise respondent No. 2 is not appointed as Officer of Inland Revenue under section 30 of the Sales Tax Act, 1990 and section 207 of the Income Tax Ordinance, 2001 and as such is not empowered to issue show cause notice and pass order-in-original relating to matters of Sales Tax and Income Tax under section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001. Hence, by issuing show cause notice with the inclusion of amount of Sales Tax and Income Tax, your authority usurped the power of Officer of Inland Revenue to which he is not vested, Rendering the issuance of show cause notice and order-in-original being in flagrant violation of law and as such coram non judice as held in Order in Sales Tax Appeal No. 444/03, STA 465/07 and judgments reported at PLD 1971 SC 184, PLD 1976 Supreme Court 514, 1992 ALD 449, 2004 PTD 624, PLD 2004 Supreme Court 600, PLD 2005 Supreme Court 842, 2009 PTD 1112, 2010 PTD 465 and 2010 PTD (Trib.) 1636.

(ix)That it is also imperative to state that the expression of section 179 of the Customs Act, 1969 is very clear in regards to determination of Adjudicating Authority on the basis of "amount of duty and taxes involved excluding the conveyance." Not "amount of evaded duty and taxes". In the instant case of appellant the involved amounts of duty and taxes are Rs. 5,413,139.00 (amount of Insurance guarantee Rs. 2619700.00 + impugned loss of revenue shown in show cause notice Rs.2793439.00). Meaning thereby the competent authority to adjudicate the case in question under clause (i) of section 179(1) is Collector.

(x)The respondent No. 2 inspite admitting the said fact in para 13(b) of the order that the expression of section 179 speaks about amount of duty and other taxes "involved", opined that this means duty and taxes not levied i.e. evaded, which according to the Directorate General of Transit Trade are 2793439.00 which falls under his jurisdiction. This is total absurdity because the word "involved" mean that the amount of the insurance guarantee and the worked out short amount, which is Rs. 5,413,139.00 and the case of such amount falls outside the ambit of the respondent No. 2. He issued the show cause notice and the order-in-original while usurping the powers of Collector, which is not permitted under law. Rendering both suffers from lack of powers/jurisdiction, hence, ab initio null and void and coram non judice as held in Order in Sales Tax Appeal No. 444/03, STA 465/07 and judgments reported at Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer and Company v. Controller of Customs, (Valuation): (PLD 1976 Supreme Court 514), Ali Muhammad v. Hussain Buksh and others (1992 ALD 449), (1) Karachi AAA Steel Mills Ltd. v. Collector of Sales Tax and Central Excise Collectorate of Sales Tax, (PLD 2001 Supreme Court 514), Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others, (2004 PTD 624), (PLD 2004 Supreme Court 600) - All Pakistan News Paper Society and others v. FOP, (PLD 2005 Supreme Court 842), Khyber Tractors (Pvt.) Ltd. v. FOP, (2006 PTD 2237), Pak Suzuki Motors Company Ltd., Karachi v. Collector of Customs, Karachi, (2009 PTD (Trib.) 1996) and (2010 PTD (Trib.) 832), (2009 PTD 1112), (2010 PTD 465), (2010 PTD (Trib.) 1636) and (2015 PTD 1469), M/s. SRS Impex, Karachi v. Superintendent Director-General of Intelligence and Investigation.

(xi)That since the consignment of the appellant has been brought into Pakistan for transit to Afghanistan, on which no duty and taxes are payable. His case falls under the technical violation of the Afghan Pakistan Transit Rules embodied in Chapter VII of Chapter XXI of Customs Rules, 2001 and therefore by all means pertains to technical violation of import or export restriction without the involvement of any evasion of duty and taxes and it falls within clause (d) of para 3 of Notification No. 886(I)/2012 dated 18.07.2012. The appropriate authority to adjudicate such cases rest with the Principal Appraiser of DG T&T in terms of proviso to Sub-Rule (6) of Rule 473 ibid., the opinion of respondent No. 2 in sub-para 13(a) in this regard, while laying stress on section 32 of the Customs Act, 1969 is out of context as section 32 can be invoked on the consignment imported into Pakistan for home consumption or warehousing etc. Therefore, by laying hands on the Sovereign Territory of the DG T&T, respondent No. 2 transgressed the power not vested with. Rendering the show cause notice and order-in-original to be passed as without power/jurisdiction, void and ab initio as held in reported judgment PLD 1975 SC 331, S.T. Appeal No.984/98, S.T. Appeal 72/04, ST Appeal 54/09, S.T. Appeal No. 2352/99, S.T. Appeal No. 106/03, 2002 CLC 705, 2004 PTD 624, 2004 PTD 3020, 2007 PTD 1895, 2009 PTD (Trib.) 1925, 2005 PTD (Trib.) 135, 2010 PTD (Trib.) 759, 2010 PTD (Trib.) 1283, Customs Appeal No. K-44/2010 and Customs Appeals Nos. K-435/08 to 455/08, 2010 PTD (Trib.) 2523 and K-638/2010-727/2010.

(xii)That it is settled proposition of law that neither superior nor subordinate can exercise powers of each other in any circumstances while acting as quasi judicial officer, exercise of power not vested amounts to transgression and render the entire super structure built thereon to crumble down, reference is placed to the reported judgment PLD 1973 Supreme Court 49 The State v. Zia-ur-Rehman and others and 2009 PTD 1083 held that "Superior authority cannot exercise the power of his subordinates for adjudication purpose .....powers of sub-ordinate exercise by superior authority is held as without jurisdiction beside usurpation" and in Abida Rashid v. Secretary, Government of Sindh PLD 1995 Kar. 587 is referred. Their lordship observed as under:

"It is trite law that power vested in an authority should only be exercised by that authority, in default whereof, the exercise of power and authority becomes without jurisdiction, illegal, void ab initio and of no legal effect. The term "without jurisdiction" has been judicially interpreted to include usurpation of power warranted by law (the Chief Settlement Commissioner Lahore v. Raja Muhammad Fazil Khan and others PLD 1975 @ p.339) an act done which the person doing, it has no jurisdiction at all to do or which was clearly outside the scope of his activities (The State v. Zia-ur-Rehman PLD 1973 SC 49) and a judgment or order delivered by a court or a judicial or a quasi judicial authority not competent to deliver it (Muhammad Saleh and others v. M/s. United Grain and Fooder Agencies PLD 1964 HC 97). The Constitution jurisdiction can thus be exercise when it is shown that the order is passed without jurisdiction or in excess of jurisdiction. As observed earlier the respondent No.1 has no jurisdiction to pass the impugned order. As such we declare the same to be of no legal effect. Accordingly, we allow this petition but leave the parties to bear their own cost".

(xiii) The assuming of jurisdiction either intentionally or inadvertently is fatal by virtue of the fact that it is not a technical defect instead an act in derogation of the expression of statute and render the whole proceeding without jurisdiction/lawful authority as held in reported judgment 2010 PTD 465 Collector of Customs, Model Customs Collectorate v. M/s. Kapron Overseas Supplies Co., (Pvt.) Ltd. "any transgression of such jurisdiction for not being a technical defect would render entire exercise of authority to be ab initio, void and illegal" and "the exercise of jurisdiction by an authority is a mandatory requirement and its non fulfillment would entail the entire proceeding to be "coram non judice." The said defect render the show cause notice as well as Order-in Original ab initio, null and void by virtue of suffer of lack of power/jurisdiction. Hence, coram non judice and needs to be struck down.

(xiv) While ignoring the heading of the Section reading as "Declaration and The respondent No. 2 is at great fault to hold that Goods Declaration for transit to Afghanistan has to be filed under the provision of section 79(1), while relying on the phrase "or for any other approved purpose" available therein assessment for home consumption and warehousing". The entire clauses of section 79(1) and section 2 and 3 with clarity speaks about import into Pakistan and duty and taxes leviable thereon and payment of those. He is reading the phrase "or for any other approved purpose" in isolation and out of essence and spirit of section 79(1). The Goods Declaration for any other purpose are not the Goods Declaration for transit goods to Afghanistan, instead for home consumption and warehousing in Pakistan and which are (i) Home Consumption (ii) In-Bond Public (iii) In-to-Bond Diplomatic (iv) In-to-Bond Manufacturing (v) Ex-Bond Public (Warehouse) (vi) Ex-Bond (Private Warehouse) (vii) Transshipment (viii) Home Consumption on TP (ix) In-to -Bond Private on TP (x) In-to-Bond Public on TP (xi) Safe Transportation (xii) Temporary Import (xiii) Temporary Import on TP (xiv) Re-Importation of Exported Goods under section 22 (xv) Relief, Donation, Charity (xvi) Privilege Person (xvii) Baggage (xviii) Vehicle Baggage & (xix) Carne Dce Passage.

(xv)The Goods Declaration for Afghan Transit Goods has to be filed under section 129 of the Customs Act, 1969 and Rule 472 of Sub-Chapter VII of Chapter XXI of the Customs Rules, 2001 and this stood validated from the heading of section 129 "Transit of goods across Pakistan to a foreign territory" and it express that "where any goods are entered for transit across Pakistan to a destination outside Pakistan the appropriate officer may, subject to the provision of the Rules, allow the goods to be so transited without payment of duty which would otherwise be chargeable on such goods". The section 129 and Rule 472 confirms with clarity that it has no nexus whatsoever with section 79(1) of the Customs Act, 1969 and render the observation of respondent No. 2 inapt and absurd. Hence of no legal effect and void and ab-initio.

(xvi) That notwithstanding to the fact that the consignment of the appellant is meant for transit to Afghanistan, on which no duty and taxes are payable, it is not out of place for the appellant to state that, section 32 of the Customs Act, 1969 can be invoked on the consignment imported for home consumption under section 79(1) of the Customs Act, 1969 in case of mis-declaration, having no monitory consequences and this has been held reported judgment PLD 1996 Karachi 68, Kamran Industries v. Collector of Customs (Exports) that where there is no revenue loss the provision of section 32 cannot be invoked. Similarly in reported Judgment 2007 PTD 2215 Collector of Customs (Exports) and another v. R. A. Hosiery Works their Lordship Rana Bhagwan Das and Saiyed Saeed Ashhad JJ, held that; provision of

"Provision of S.32(1) of Customs Act, 1969, would be attracted only when a mis-declaration or mis-statement was made with a view to obtain illegal gain by evasion of payment of customs duty and other taxes or by causing loss to Government revenue---Mis-declaration alleged to have been made in the case, was neither for evasion of payment of customs duty to other taxes/charges nor the same has caused any financial loss to the Government---Petition for leave to appeal by the Authorities being without merit, was dismissed."

(xvii) That lastly, as regards to the terming of appellant imported nut bolts due to inscription of word "Benz" by the respondents as auto parts, said to be not permitted to be imported by a person of Afghanistan for transit under Notification No. 151(I)/2004 dated 10.03.2004 is also misconceived. The appropriate PCT for Auto Parts and accessories of motor vehicle falls under PCT 87.08, which read as "Auto Parts and accessories of motor vehicle falls read as of headings 87.01 to 87.08". None of the Sub-Heading subsequent 87.08 contains bolts an nuts as parts of motor vehicle. The appellant is at great loss to digest the fact that how with the inscription of the word "Benz" the respondents are terming the appellant imported bolts and nuts as auto parts.

(xviii) The bolts and nuts imported by the appellant are infact classifiable under Sub-Chapter 18 of Chapter 73 of Pakistan Customs Tariff reading as "Screw, Bolt, Nuts, Coach Screws, Screw Hooks, Revits, Cotter, Cotter Pin, washer (Spring Washer) and similar articles of iron or steel. This mean that similar items as described in sub-heading are also included in this sub-chapter inspite not mentioning of the name of the similar articles. Since imported nut bolts are not coach screw, screw hooks and screw ring, self taping screw these does not falls under PCT headings 7318.1100 to 7318.1300. Instead these are other nuts and bolts, for which sub-heading 7318.15 is carved in the Tariff under which nuts bolts of high tensile (DIN Grade 8.8, ASTM A325 or ASTM A193, B7) or (i) U Bolt for leaf for vehicle Spring for vehicle of Chapter 87 (appellant bolts are not U Bolts therefore does not falls under PCT 7318.1520) (ii) Wheel Nuts for Vehicle of Chapter 87 (appellant goods are not wheel nuts, therefore stood ousted from PCT 7318.1520) or others. These by all means falls under PCT 7318.1590.

(xix) The appellant feel advantageous to placed reliance on the Explanatory Notes to HS 73.18 which with clarity states that "the heading includes all types of fastening bolt and metal screw regardless of shape and use". Since, the bolts and nuts of the appellant are neither parts and accessories of vehicles or U Bolts for leaf for vehicle Spring for vehicle of Chapter 87 nor wheel nut, instead nut and bolts, these cannot be termed as auto parts through any stretch of imagination, being independent and specific, hence these are excluded from the ambit of auto parts, not to be brought into Pakistan for transit to Afghanistan in terms of Notification No. 151(I)/2004 dated 10.03.2004.

(xx)That the transit goods for Afghanistan are akin to the goods transshipped to the Dry Port of upcountry in terms of Section 121 of the Customs Act, 1969 for clearance for home consumption under section 79(1) of Customs Act, 1969 at the Dry Port of Pakistan cannot be held or examined in case of any discrepancy, mis-declaration, loss to the exchequer and these has to be allowed to be transshipped to the port of clearance for examination and initiating proceeding in accordance with the provision of Customs Act, 1969 and if those had been examined, the discrepancy found during the course of examination has to be communicated to the clearance station in Afghanistan, who is the appropriate authority to proceed in the goods in Transit to Afghanistan, as held by the Superior Judicial Fora in reported judgment 1989 MLD 2322, M/s. Famous Corporation v. Collector of Customs, 1992 CLC 57, M. Hamidullah Khan v. Directorate General of Customs Intelligence and 3 others and as 2003 PTD 14 N.B. Trading Company, Sambrial, Sialkot v. Collector of Customs, Appraisement and others.

(xxi) The order passed by the respondents No. 2 shows that it has not been passed with the application of mind and provision of the Act/Rules. Instead is a non speaking order and did not conforms to the mandated requirement of section 24-A of the General Clauses Act, 1897 and this stood validated from the fact that he framed the issue in accordance to his own understanding not in accordance provision of the Act/Rules and the arguments submitted by the appellant consultant in reply and rebuttal and this stood validated from the fact that he completely failed to rebut those inspite of incorporating in the Order at pages 4 to 11 and 16 to 19. Such type of orders are deems to be always treated as illegal, void, arbitrary and a result of misuse of authority vested in public functionary. No room was available for such illegal, void and arbitrarily order in any system of law. If any authority Court or Tribunal gave a finding of fact which was not based on material available on record was illegal arbitrarily without discussing and considering the material available on record it became perverse and a perverse finding of fact which is violative of the established principle of appreciation of evidence on record was not sustainable in law. The principle that every judicial or quasi-judicial finding should be based on reasons containing the justification for the finding in the order itself is an established principle of dispensation of justice. The Adjudication/Appellate orders are being violation of basic principle of the goods governance and mandatory requirement of Section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law. The said position is also fortified by the judgments of Superior Courts reported as 2005 YLR 1019, 2007 PTD 2500, 2004 PTD 1973, 2005 YLR 1719, 2003 PTD 777, 2003 PTD (Trib.) 2369, 2002 MLD 357, 1983 CLC 2882, 2005 PTD 2519, 2005 PTD 1189, 2003 PTD 2369 and PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173, 1984 SCMR 1014 and 2012 PTD (Trib.) 619.

4.The appellant No. 2 for imposition of penalty by respondent No. 2 also filed the appeal before this Tribunal on the ground incorporated in the Memo of Appeal, which are as under:-

(i)That upon examination of the show cause notice, it can be observed that it is completely silent in regards to any act and commission of the appellant contrary to the provision of section 129 of the Customs Act, 1969, Rules embodied in 121(I)/2014 dated 24.02.2014 and Licensing Rules embodied in Chapter VIII of Custom Rules, 2001. It with clarity confirms that M/s. Zubair Wali Ahmed Zai Ltd., Kabul Afghanistan engaged his services and he transmitted goods declaration on the strength of the documents supplied by them and thereafter got the Customs Codal Formalities completed strictly in accordance with Rules 474 to 476 of Transit Rule notified vide SRO 121(I)/2014 dated 24.02.2014. No allegation of any sort has been leveled against the appellant and the impugned show cause notice was served on the appellant only for the sake of information and for communication to the M/s. Zubair Wali Ahmed Zai Ltd., Kabul Afghanistan.

(ii)That as per prescribed Rule, the appellant carry out the business clearance and files Goods Declaration under section 129 of the Customs Act, 1969 and Rule 472 of Sub-Chapter VIII of Chapter XXI of the Customs Rules, 2001 on the strength of the documents supplied to him by the importer of Afghanistan. Those were processed by the appropriate officer as notified in Rule 473 for clearance and the subordinate of respondent No. 1 accordingly, completed the formalities and the container was allowed gate out in terms of clause (ii) of Rule 474 ibid. This entire action had been completed by the official of DG T&T & Terminal independently without any influence of the appellant or his subordinate. In the regime of WeBOC System, the clearing agent has no part to play, meaning thereby that he cannot influenced them in any manner, instead assist them in case of need.

(iii)That as deliberated above infact appellant in the capacity of clearing agent has no part to play. The entire transaction is between exporter/importer and the customs. The clearing agent only provides services to the exporter/importer on very nominal charges and extends co-operation to the customs officials for carrying out their job. To be most precise, a clearing agent act as a post office or transit station between these two but this assistance is not applicable in the clearance obtained under the regime of "WeBOC".

(iv)That in support of the above submission, it is felt appropriate to place reliance on multiple judgment issued by the Hon'ble Customs Appellate Tribunal in regards to the conduct and commission of the clearing agent, reference is placed to few of those cases titled as M/s. Shoaib Enterprises, Karachi and Sakro Corporation, Karachi, wherein in Order-in-Appeals Nos. K-1833/01 dated 19.01.2002 and K-538/2003 (K-2) dated 25.10.2003, it has been held that provisions of section 209 of the Customs Act, 1969 provide immunity and limited liability against the agent and an agent cannot be charged for mis-declaration under section 32 of the Customs Act, 1969 if he filed documents under the provisions of Customs Act, 1969 in accordance with the export documents and further held that the action taken by the customs of charging agent and thereafter leveling penalty without any fault or default on his part is not only unfair but also illegal. The Lahore High Court in the case of M/s Ports Ways Custom House Agent and another's v. Collector of Customs and another's reported at 2002 YLR 2651 held that:

The imposition of penalty on the Clearing Agent/appellant No.1 was all the more unjustified. To hold the clearing agent liable for the act of commissions and omissions on the part of the importer will require a clear finding based upon legally acceptable evidence of his being an active and conscious party to the manipulation. In normal course of his business, a Clearing Agent, files a bill based upon the document and information provided by the importer. He cannot be presumed to be a privy to any illegal arrangement, which the importer may have coined or had intended in his mind. For that purpose some evidence of his direct involvement will have to be brought on record. Particularly when it is not shown that the Clearing Agent was directly or indirectly a beneficiary of invasion of taxes. In the present case no attempt whatsoever was ever made to bring home guilt to the Clearing Agent. The appeal is accepted to the extend of Clearing Agent.

The appellant is at great loss to digest the fact that how and under what circumstances he has been issued show cause notice and penalized without any cause or reason, only on the basis of dispatching copy of show cause notice without any allegation. Whereas, the Custom Officials who completed the procedure of clearance are let free without any allegation. This amounts to giving a partial treatment to the appellant. A person placed at the same pedestal cannot be treated differently as it would constitute a discrimination in negation to Articles 4 and 25 of Constitution of Islamic Republic of Pakistan. In reported judgment 2002 SCMR 312 and 2009 PTD 1507 the Hon'ble Superior Courts have observed that "there exists no power to target incidence of tax in such a way that similarly placed person be dealt not only dis-similarly, but discriminatingly". Whereas, in reported judgment 2005 SCMR 492 the Hon'ble Supreme Court held that "A facility allowed to some one and denied to other is discrimination". The Apex Court further held in reported judgment 2010 SCMR 431 that:

"Doctrine of equality, as contained in Art. 25 of the constitution, enshrine golden rules of Islam and states that every citizen, no matter how high so ever, must be accorded equal treatment with similarly situated persons---State may classify persons and objects for the purpose of legislation and make laws applicable only to persons or objects within a class---In fact all legislations involve some kind of classification whereby some people acquire rights or suffer disabilities whereas others do not---What however, is prohibited under principle of reasonable classification, is legislation favouring some within a class and unduly burdening others---Basic rule for exercise of such discretion and reasonable classification is that all persons placed in similar circumstances must be treated alike and reasonable classification must be based on reasonable grounds in given set of circumstances but the same in any case must not offend spirit of Art. 25 of the Constitution."

6.The Respondent has submitted parawise comments/counter objection in reply to the memo of appeal, which are reproduced as under:-

(i)Contents of ground 1 are vehemently denied. It is denied that the show cause notice has been issued to the importer based in Afghanistan. It is respectfully submitted that the GD is filed in Karachi, Pakistan and a declaration was made before the Customs Officials, which is incorrect to the knowledge of importer/clearing agent with the mala fide intention therefore the respondent had correct issued a show cause notice to the appellant. Since, the crime has been committed within the territory of Pakistan the department has every right to proceed against any person who is involved in the commission of the crime. Customs Act, empowers the respondent to proceed against any person in case the crime is committed with the country as it applies whole of Pakistan.

(ii)Contents of ground No. 2 are vehemently denied. It is respectfully submitted that an incorrect declaration has been filed. Apart from that the appellant had imported item No. (xii) Benz wheel Bolt being auto-parts which are not reportable in terms of SRO 151(I)/2004 dated 10.03.2004. Therefore, the goods are liable to be confiscated and as such provision of Customs Act, 1969 were rightly invoked.

(iii)Regarding ground No. (3a) it is respectfully submitted that the respondents have acted upon the information to the effect that the huge quantity of auto parts is being smuggled into Pakistan via container No. PCIU-8563551 beside other declaration. It is respectfully that the container was examination and upon detailed examination it transpired that 13 items were found undeclared out of which 01 item i.e. Benz Wheel Bolts was also found in terms of SRO 151(I)/2004 dated 10.03.2004. It is further submitted that unless the respondent as take measures to stop the crime the goods would have been consumed within Pakistan, therefore, the container was rightly intercepted and the proceeding conducted there after are therefore in accordance with law.

(iv)Ground 3(b) is denied the appellant is put to strict proof of the statement made in this para.

(v)Ground 3(c) is denied. The provision of section 171 were complied with. The appellant was served with the notice as required under the law.

(vi)Ground 3(d) is denied. The show cause notice had been served within time. Therefore, the appellant's contention is incorrect. The case law cited is therefore not applicable in the instant case.

(vii) Ground (e) is incorrect and has been taken in ignorance of law. It is respectfully submitted that the Sales Tax Act empowers the Collector of customs to recover the Sales Tax in the manner and at the time as if it was a duty of customs. Similar provisions have been enacted in relation to the recovery of income tax. Section 6 of the Sales Tax Act, 1990 which empowers the Collector to recover Sales Tax on the import of goods is reproduced below:

6. Time and manner of payment:- (1) The tax in respect of goods imported into Pakistan shall be charged and paid in the same manner and at the same time as if it were a duty of customs payable under the Customs Act, 1969 1 [and the provisions of the said Act 2 [including section 31A thereof] shall, so far as they relate to collection, payment and enforcement 3 [including recovery] of tax under this Act on such goods where no specific provision exists in this Act apply].

Similarly, Section 148 of the Income Tax Ordinance, 2001, authorizes the Collector to collect advance tax from every importer.

(viii) In view of above stated legal position, the ground is vehemently denied.

(ix)Ground g is incorrect. The learned Adjudicating officer has given its findings on this issue which are correct and explanatory. The findings on this issue are reproduced as under and need no more comments on this issue.

"the counsel of the respondent has raised legal objection in respect of assumption of jurisdiction by this forum on the pretext that the total amount of duty and taxes involved is Rs. 5413,139.00, it has been observed that the department has referred the case for adjudication in respect of mis declared/banned item and has not included the value/duty and taxes involved in respect of the declared items. The amount of duty/taxes involved in respect of mis-declared items are Rs. 27,93,439.00 which fall within the jurisdiction of this forum. Furthermore, it will be appropriate to examine the provisions of section 179 of the Customs Act, 1969, for reference the same is reproduced herewith:-

"179. Power of Adjudication: Subject to subsection (2) in cases involving confiscation of good or recovery of duty and other taxes not levied short levied or erroneous refunded, imposition of penalty or any other contravention under this Act or the Rules made thereunder the jurisdiction and power of the officer of Customs in terms of amount of duty and taxes involved excluding the conveyance, shall be as follows.....

Since the duty and taxes not levied in this case have been reported by the Directorate General of Transit Trade reported as Rs. 27,93,439/-, which fall within the monitory limit of this forum. Thus, the objection raised by the respondent is not tenable."

(x)Ground h is incorrect, hence vehemently denied. The appellant is wrongly interpreting the provision of law. The learned Adjudicating Officer rightly exercised his powers and has justified his authority to deal with the matter in the order passed by him, which is self explanatory.

(xi)Ground (i) is incorrect. The case of the appellant is not that of a technical violation. Perusal of the examination report reveals that the importer has mis-declared the contents of the consignments, thus provisions of section 32 of the Customs Act, 1969 are attracted and have been correctly invoked. Furthermore, the argument of the respondent that the GD for transit is filed under section 129 of the Customs Act, 1969 and not section 79 of the Customs Act, 1969 is incorrect.

(xii)Ground (i) incorrect. The case of the appellant is not that of a technical violation. Perusal of the examination report reveals that the importer has mis-declared the contents of the consignments, thus provision of Section 32 of the Customs Act, 1969 are attracted and have been correctly invoked. Furthermore, the argument of the respondent that the GD for transit is filed under section 129 of the Customs Act, 1969 and not section 79 of the Customs Act, 1969 is incorrect.

(xiii) Ground J is not correct. The Adjudicating authority had exercised his powers correctly and lawfully. Since the officer exercising his powers and conducting Adjudication is vested with the powers therefore the ground is not available to the appellant.

(xiv) In view of above stated facts, the ground is incorrect and has been taken wrongly. The respondent is vehemently denied the same.

(xv)Ground (l) is incorrect interpretation of the provision of law. It is respectfully submitted that the learned Adjudicating authority rightly held that the arguments of the respondent that the GD for transit is filed under section 129 of the Customs Act, 1969 and not section 79 of the Customs Act, 1969 is incorrect. Perusal of both the sections reveals that for any purpose, the Goods Declaration has to be filed under section 79 of the Customs Act, 1969. Perusal of the provisions will negate the contention of the appellant. Therefore, it will be appropriate to examination the provisions of both sections.

"79. Declaration and assessment for home consumption or warehousing:- (1) The owner of any imported goods shall make entry of such goods for home consumption or warehousing or for any other approved purposes, within fifteen days of the arrival of the goods, by"

129. "Transit of goods across Pakistan to a foreign territory. Where any goods are entered for transit across Pakistan to a destination outside Pakistan, the appropriate officer may, subject to the provisions of the rules, allow the goods to be so transited without payment of the duties which would otherwise be chargeable on such goods."

It is clear that section 79(1) requires the owner of any imported goods to make entry for

(a)Home consumption

(b)Warehousing

(c)Any other approved purpose.

Thus, the goods declaration filed for Transit falls under "any other approved purpose". Section 129 only empower the officers of the Transit Trade to process the goods declaration in the light of relevant rules.

(xvi) In view of the legal position explained in Para (1) ground (m) is incorrect, hence vehemently denied.

(xvii) Ground (n) is vehemently denied. It is respectfully submitted that the appellant in ignorance of law has taken such plea. It is incorrect that since no duty/taxes are involved section 32 of the Customs Act, 1969 cannot be invoked. Since for transit goods, duty/taxes are levied however, the same are not paid 1969 read with rules and provision of section 32 are attracted.

(xviii) Ground (o) incorrect. It is respectfully submitted that the appellant imported Benz Wheel Bolts, which are auto parts and as such are not importable in terms of SRO 151(I)/2004 dated 10.03.2004, therefore the goods are liable to be confiscated and as such the provisions of Customs Act, 1969 were rightly invoked.

(xix) Ground (p) is also incorrect, hence vehemently denied. It has been rightly observed and held by the learned Adjudicating Authority that Benz Wheel Bolt being auto parts are not importable in terms of SRO 151(I)/2004 dated 10.03.2004. The departmental representative had produced literature/photograph before the adjudicating authority which clearly depict that the same are Mercedez Benz Wheel Bolts and nuts. Accordingly, the same are not allowed to be imported under SRO 151(I)/2004 dated 10.03.2004, in addition the departmental representative has submitted that the same are specifically mentioned as nuts/bolts for vehicle in chapter 73 of the Pakistan customs Tariff.

(xx)In view of statement made in para (o) grounds (q) is vehemently denied.

(xxi) Ground V is incorrect as such vehemently denied. It is respectfully submitted that the show cause notice as well as order-in-original and the order in appeal are correct and in accordance with law. Such orders are liable to be up held by the Honourable Appellate tribunal. It is vehemently denied that the order is a non-speaking order and does not fulfill the requirement of section 24-A of General Clauses Act.

Whereas, comments of the respondent No. 1 in Appeal No. K-1311/2015 filed by appellant No. 2 are as follows:-

(i)Denied. It is vehemently denied that the show cause notice issued by Adjudication Collectorate is silent in respect of clearing agent. It is submitted that the clearing agent (appellant in the instant case) is a principle of his Afghanistan based importer i.e. M/s. Zubair Wali Ahmed Zai Ltd., (an Afghanistan based importer) and act fraudulently while imported and cleared the impugned consignment which contained huge quantity of auto parts which is otherwise not transited to Afghanistan in terms of SRO 151(I)/2004 dated 29.03.2004. Therefore, contravention proceedings initiated against the appellant by mentioning his offence in the show cause notice.

(ii)that in view of the submission made hereinabove, the contents of para (ii) warrants no further comments. However, it is respectfully submitted that in view of the Rule 101 of Customs Rules, 2001 notified vide SRO 450(I)/2001, the appellant be responsible for act do or on his behalf or on behalf of his client, therefore, the contention of the appellant to the effect that he only filed Goods Declaration under section 129 of the Customs Act, 1969 and Rule 472 of Sub-Chapter VIII of Chapter XXI of the Customs Rules, on the strength of the documents supplied to him by the importer of Afghanistan.

(iii)it is vehemently denied that the clearing agent act as a post office. It is respectfully submitted that the customs agent licensed under section 207 of the Customs Act, 1969, while acting on behalf of his principle for customs business in relation to any goods, is deemed to be the principle of the such goods within the meanings of subsection (3) of section 209 of the Customs Act, 1969 read with Rule 101 of Customs Agent Licensing Rules specified under Chapter VIII of Customs Rules, 2001 notified vide SRO 450(I)/2001 dated 18.06.2001 as amended from time to time.

(iv)Regarding para (iv), it is respectfully submitted that since the importer is not available in Pakistan and it is the clearing agent (the appellant in this case) at the port of entry of the goods who had got the goods cleared, the principle responsibility of appellant to act as per relevant Rules and Act, whereas in the instant case, the appellant in connivance with his Afghanistan based importer, committed offence of mis-declaration of goods and importation of prohibited items, which are otherwise not allowed to be transit into Afghanistan in terms of SRO 151(I)/2004 dated 29.03.2004, therefore, penal proceedings under section 32 of the Customs Act, 1969 were initiated against the appellant for conteravention of above said provisions of law.

(v)that in view of the submission made in para (iv) above, the contents of para (v) warrants no further comments.

(vi)Para (vi) does not exist.

(vii) Para (vii) needs no comments.

6.Rival parties heard and the case record perused along with the citation relied upon. I take up the case for decision and frame following issues for determination.

(i)Whether Officials of DGTT have any locus standi to proceed against importer of foreign country under any provisions of the Customs Act, 1969?

(ii)Whether the words "mis-declaration" is available in the Revised Koyoto Convention 1999, Afghan Pakistan Transit Trade Agreement, 2010 (APTTA) and Transit Trade Rules, incorporated in Sub-Chapter VII of Customs Rules, 2001 and as to whether an importer of foreign country can be proceeded for the charge of mis-declaration falling under the provisions of section 32 of the Customs Act, 1969 or Import Policy Order, 2013?

(iii)Whether any mechanism has been provided in section 129 of the Customs Act, 1969 and APTTA, 2010 to get the goods passed in the terminal after those had been allow gate out after completion of codal formalities in terms of Rules 472 to 474 ibid.?

(iv)Whether detaining of goods at terminal is tantamount to notional seizure and whether show cause notice to the person whose goods are seized is mandated to be issued within 02 months from the date of seizure as expressed in section 168(1) of the Customs Act, 1969, any deviation render the show cause notice barred by time?

(v)Whether Show cause notice can be issued under the provision of section 33 of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001 and whether respondent No. 2 is empowered to issue show cause notice under the provision of section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001 for recovery of non short levied amount of Sales Tax and Income Tax.?

(vi)Whether the show cause notice in the instant case has been issued by the authority defined in the proviso of Sub-Rule (6) of Rule 473 of Sub-Chapter VII of Customs Rules, 2001?

(vii)Whether Goods Declaration of Transit Trade has to be filed under the provision of section 79(1) of the Customs Act, 1969?

(viii) Whether the impugned goods "Benz Wheel Bolt" are correctly treated as auto parts being notified under SRO 151(I)/2004.

(ix)Whether the goods found in excess during the course of examination as against reported in Goods Declaration for Transit Trade under Rule 472 Sub-Chapter VII of Chapter XXI of Customs Rules, 2001 and which are lying in the Port/Terminal can be either seized or confiscated in terms of Rule 484-Q ibid and clause (64) of section 156(1) of the Customs Act, 1969 on the presumption that these shall be smuggled back in Pakistan or pilfered during the course of transit?

(x)Whether appellant No. 2 acted contrary to defined duties in the respective provisions of the Act and Chapter VIII of Customs Rules, 2001?

7.That as regard issue No. (i), I, referred to the preliminary of Chapter 1 of the Customs Act, 1969, subsection (2) with clarity expresses that it extent to whole of Pakistan. Meaning thereby, that the provisions of the Act are applicable on the person who is citizen of Pakistan and is engaged in the business of Import or Export or manufacturing and during the course of his business activities commits any contravention of the provisions of the Act, shall be proceeded against under the relevant applicable provisions of the Act and the Rules framed thereunder. The appellant is a citizen of Afghanistan and is duly registered as an importer with the Ministry of Commerce and Industry of Afghanistan (MOCA) vide Trade License No. 20952 and registration No.62113 dated 22.07.2013 for importing goods for home consumption in Afghanistan at Karachi for transit to the place of business in Afghanistan under the APPTA Agreement 2010. Since, import for transit to Afghanistan is handled by DGTT, every importer has to get itself registered with the online system of filing GD i.e. "WeBOC" regime, he submitted an application with the designated authorized Official of MOCA in Afghanistan by the MCC of Appraisement-East, Karachi. The Official of MOCA registered him and allotted User ID and password, which the Officials of MOCA through mail along with application and submitted documents forward to the Deputy Collector MIS, MCC of Appraisement -East. In this whole procedure, the appellant has no direct communication with either the Official of MCC of Appraisement-East or DGTT. Any discrepancy found in import documents submitted for transit of the goods or in the goods so imported has to reported by the DGTT to the MOCA through Ministry of Commerce, Pakistan and subsequently has to file a complaint under para 2 of Article 3 of Section II Afghan Pakistan Transit Trade, 2010 (APTTA) before the Afghanistan Pakistan Transit Trade Co-ordination Authority under Article 34 of Section X ibid., under the provision of Customs Act, 1969, the Official of Customs are not empowered to proceed. Instead the Ministry of Commerce (MOCA) is the appropriate Authority to proceed against an importer of Afghanistan in accordance with their Import Policy Order or Custom Act of Afghanistan not the Officials of Customs including DGTT, due to the fact that the provisions of Customs Act, 1969 are not applicable in Afghanistan nor on the citizen of Afghanistan, which the appellant is. As deliberated I am clear in mind that the Officials of DGTT and respondent No. 2 have no locus standi to serve show cause notice to the appellant. The issue No. (i) is answered in negative.

8.That as regard to issue No. (ii), I have gone through the Revised Kyoto Convention, 1999, Afghan Pakistan Transit Trade Agreement, 2010 (APTTA) and Sub-Chapter VII of Chapter XXI of Customs Rules 2001 and fail to find the said word in these. Confirming that the word mis-declaration is alien to these, the emphasis laid in proviso to Sub-Rule (6) of Rule 473 ibid speaks about "discrepancy". Since, no definition of the word discrepancy is given in Article 2 of APTTA, or even in any taxing Statute/notification, ordinary grammatical meaning has to be adopted as it is elementary rule of construction that phrases and sentences of the statute should be construed according to the rules of grammar and the words of a statute should be interpreted in their plain grammatical sense. The word discrepancy is defined in The Chambers Dictionary 1997 Edition: Disagreement; variance of facts or sentiment and in The Lexicon Webster Dictionary of English Language Encyclopedic Edition: the state of being discrepant; and discrepant means inconsistence; at variance. Meaning thereby that if facts shown in TT GD differs or in variance, the word discrepancy is used in the Rules intentionally because the provision of Customs Act, are not applicable on these goods due to non declaration, which an importer of Afghanistan has to file with the Afghan Customs at the port of clearance, goods found contrary to the said declaration, are deems to be mis-declared, consequent of which is that the said person/importer is liable to adjudication proceeding by the Official of Customs under the Customs Act of Afghanistan. The importer of Afghanistan vide transmitting goods declaration under WeBOC regime, narrate the tentative facts of the goods stuffed in container, that could be varied, in description, quantity, quality and weight, which is curable through an amendment or if i.e. not possible, the importer can be asked to submit additional insurance guarantee for the amount of leviable duty and taxes on the value determined under section 25 or 25A of the Customs Act, 1969 for home consumption in Pakistan under provision of section 79(1) of the Customs Act, 1969. Inspite of the said fact the respondent No. 2 termed the discrepancy as mis-declaration as evident from the show cause notice and Order-in-Original and which falls within the ambit of section 32 of the Customs Act, 1969 and applicable on the import for Pakistan, clearance of which is obtained under the provision of section 79(1) of the Customs Act, 1969 and this is validated from the expression of section 32, which read as:

Section 32 False statement, error, etc.---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. (Emphasis Supplied)

The appellant has not filed Goods Declaration under the provision of Section 79(1) of the Customs Act, 1969, instead under Section 129 of the Customs Act, 1969, which read as: "Transit of goods across Pakistan to a foreign territory. Where any goods are entered for transit across Pakistan to a destination outside Pakistan, the appropriate officer may, subject to the provisions of the rules, allow the goods to be so transited without payment of the duties which would otherwise be chargeable on such goods."

"Provided that the Federal government may, by notification in the Official Gazette prohibit the bringing into Pakistan by Sea, land or air in transit to a foreign territory any goods or class of goods."

From conscientious study of the Section 129, it is abundantly clear that the goods imported in Pakistan for transit to foreign country is not leviable to duty and taxes, which are otherwise leviable and to be paid in case of filing Goods Declaration under the provision of section 79(1) of the Customs Act, 1969 and this has been done in the light of Revised Kyoto Convention 1990 and definition given in Article 2 of APTTA, 2010 "Customs Transit" means procedure through which goods are transported under Customs Control from one Customs Office of one contracting party to Customs Office of other contracting party under suspension of duty and taxes and in Article 30 of Chapter IX Customs Duties the contracting parties agreed that no custom duties and taxes shall be levied on the goods regardless of their destination and purpose." Since, the appellant has shown facts of the goods stuffed in container on the strength of the documents received by him from the shipper and on those or even found in excess no duty and taxes are leviable in Pakistan. Using of word mis-declaration in the show cause notice and order-in-original is out of context beside based on mis-conception as the provision of Section 32 of the Customs Act, 1969 or any other provision are not applicable on the said goods and this stood validated from the judgment of the Hon'ble Supreme Court of Pakistan reported at PLD 1993 Karachi 93 M/s. Najab Zarab Ltd. v. Government of Pakistan and 1996 SCMR 727 FOP v. Jamal Din and others. "Goods imported by Afghan National from other country for use and consumption in Afghanistan could not be said to have been imported into Pakistan merely because they crossed the Customs barrier and enter into Pakistan to be transited to their destination viz Afghanistan, such goods infact are goods in transit to be dealt with and transshipped to Afghanistan in accordance with the transit agreement and protocol appended thereto. Customs Laws relating to importation would not, therefore applicable to them. The Hon'ble Judges of the Supreme Court of Pakistan further held "that the provision of Customs Act and Import Control Order dealt with different kind of situation that after being imported into Pakistan and not imported into Afghanistan, the provision of Customs Act, do not deal with the goods in transit which are not really imported into Pakistan. In a case where liquor seized by the Directorate General of Intelligence and Investigation FBR after clearance for transit to Afghanistan on the pretext that the goods found in examination are liquor as against shown in Goods Declaration as mineral water amounts to mis-declaration attracting section 32 of the Customs Act, 1969 and so the prohibition laid down in Import Policy Order. The Division Bench of the Hon'ble High Court of Sindh observed vide order dated 27.10.2010 in C.P. No. D-2410 of 2010 that "in the present matter a simple allegation is made by the respondent No. 2 that a very specific provision of the Customs Act namely section 32(1) has been violated and the same amounts to an offence which could be taken cognizance by the Customs Judge appointed under the Customs Act. In our view, the petitioner's consignment and the description of the goods in the documents accompanying that consignment do not come within the preview of Section 32 and even such description may have been within the ambit of said section the same would amounts to mis-declaration only if the goods were intended for import into Pakistan that obviously does not apply in the present case since the goods admittedly are in transit under the Afghan Transit Agreement. The Hon'ble Bench on the strength of the said observation allowed the petition to the extent of FIR's C.No.Appg-287//DCl/ESKO/2010 dated 24.05.2010 and FIR C.No.Appg-288//DCI/ESKO/2010 dated 24.05.2010 and quashed and all proceeding thereunder were declared to be without lawful authority." With this I answer issue No. (ii) in negative.

9.That as regard to issue No. (iii). Upon perusal of the documents in the memo of appeal, I observed that the Official of DGTT had cleared the consignment for transit to Afghanistan after completion of all the codal formalities and the carrier proceeded for its destination to Afghanistan on 16.04.2015, when the respondent No. 1 and his subordinate stopped the container and the carrier at Kathore and brought it back to the terminal on the basis of said to be credible information that the goods stuffed in the container are far excess as against shown in the Goods Declaration, in addition to an item which is not allowed to be transited to Afghanistan in terms of Notification No. 151(I)/2004 dated 10.03.2004 and thereafter they got the container and vehicle in of the terminal inspite non availability of any provision either in section 129 of the Customs Act, 1969 nor APTTA, 2010 or even in the module of the regime of WeBOC, it is due to the fact that only goods meant for export are allowed to be gate in and goods gate in once cannot be gate out, unless, online dray application is filed. Similarly, goods allowed clearance i.e. gate out cannot be allowed to be gate-in nor can be stopped under any apprehension because it is settled proposition of law that the Customs Officials became fictitious officio and this has been held by Hon'ble High Court of Sindh in a case where show cause notice was issued under section 179 of the Customs Act, 1969 to an importer whose goods were allowed after passing of valid assessment order under the provision of section 80 of the Customs Act, 1969 for levy of duty and taxes and payment of those and thereafter passing of clearance order under section 83 of the Customs Act, 1969. Reported at 2008 PTD 1968 M/s. Sikander Enterprises v. Central Excise and Sales Tax Tribunal, Karachi that "after clearance of the goods and removal of the consignment from customs area, customs authorities were functus officio to reopen the case again it had been become past and closed transaction". The respondent No. 1 having no power under the provision of section 129 and Sub-Chapter VII of Chapter XXI of Customs Rules, 2001 to either intercept, detain, seize and pass in the terminal the goods which has already been allowed clearance and were out of customs area, with the exception of filing a complaint before the Afghanistan Pakistan Co-Ordination Authority under para 2 of Article 3 of APTTA, 2010 for conduction of proper examination and assessment by the Custom Officials of Afghanistan at the dry port, wherein, Goods Declaration for clearance would had been filed. The respondent No. 1 and his subordinate acted in derogation of the APTTA, 2010, section 129 of the Customs Act, 1969 and Chapter VII of Chapter XXI of Custom Rules, 2001. This blatant illegality render the entire exercise right from interception till passing of order-in-original without lawful authority and jurisdiction, hence, void and ab initio. The issue No. (iii) is answered in negative.

10.That as regard to issue No (iv), it has been noticed that the container and carrier was intercepted and detained on 16.04.2015, this detention falls within the ambit of notional seizure and provision of section 168(1) applies with full force as interpreted and held by the Hon'ble High Court of Sindh in reported judgment 2003 PTD 2821 Syed Muhammad Razi v. Collector of Customs (Appraisement), Karachi and 2 others that "A careful consideration of section 168(1) and section 2(rr) leads to the conclusion that the word "possession" is not confined to the physical possession and is inclusive of constructive possession as well. We are further of the considered opinion that the seizure of goods cannot be confined to the cases where an order in writing in this behalf is made but is inclusive of notional seizure as well, meaning thereby, that if the customs officials has not passed any specific order in writing about the seizure of goods but has verbally given instructions or by his conduct has made the release for removal of goods under restraint thereby depriving to the owner of the goods of exercising all the incidents of the right had title and interest in the goods, it would also amount to seizure of goods within contemplation of section 168(2) of the Customs Act." Since, detention which is notional seizure has been made by the respondent No. 1 on 16.04.2015, show cause notice was mandated to be issued by the respondent No. 2 on or before 15.06.2015. To the contrary, it has been issued on 07.07.2015 i.e.; after the expiry of initial period of 02 months, without any extension by the Collector prior to expiry of initial period after serving a notice to the person concerned and thereafter recording of exceptional circumstances and reasons in writing (1988 PCr.LJ 213 and 1998 MLD 650). There is nothing on record which could disclosed reasoned order of extension which establishes that no extension was given and this was due to the fact that no exceptional circumstances were available. Resultant, show cause notice dated 07.07.2015 barred by time by 22 days and as such without power/jurisdiction and lawful authority, hence, void and ab initio and not enforceable under law.

11.That as regard issue No. (v), upon perusal of the show cause notice I have observed that respondent No. 2 has made a reference to the sections 33 and 34 of the Sales Tax Act, 1990 which are penal clauses for contravention of the charging sections of Sales Tax Act, 1990, without realizing to the fact that sections 33 and 34 cannot be incorporated or invoked in the show cause notice in isolation, unless charging section is invoked and by the authority competent to do so under the expression of the relevant sections. These Sections are synonymous to section 156(1) of the Customs Act, 1969. Likewise has also invoked section 148 of the Income Tax Ordinance, 2001, which is machinery section and is being incorporated in the Ordinance for collection of income tax levied on the imported goods in Pakistan. No charge can be leveled on the strength of the said sections. Incorporation of the irrelevant sections having no nexus with the charges leveled in the show cause notice, renders the show cause notice and Order-in-Original void and ab initio and of no legal effect as held in reported judgment judgments Asst. Collector v. Khyber Elec. Lamps 2003 PTD 1275, D. G. Khan Cement v. Collector of Customs 2005 PTD 480, Caltex v. Collector 2003 PTD 1593 Union Playing Card Company v. Collector of Customs 2002 MLD 130, Atlas Tyres v. Additional Collector, 2002 MLD 180, State Cement v. Collector PTCL 2001 CL 558, Kashmir Sugar v. Collector 1992 SCMR 1898, Rose Color v. Chairman, CBR and 2013 PTD 813 Sarwar International v. Additional Collector of Customs. The Consultant/Advocate of the appellant has strongly contended that even otherwise respondent No. 2 has not been appointed as Officer of Inland Revenue under section 30 of the Sales Tax Act, 1990 and section 207 of the Income Tax Ordinance, 2001. Therefore, has no powers to proceed in the matter of Sales Tax and Income Tax. On the other hand the respondent No. 1 is of the opinion that the customs is empowered to collect these taxes at import stage under section 6 of the Sales Tax Act, 1990 and section 148 of the Income Tax Ordinance, 2001 and can also recover the Taxes under the provision of section 202 of the Customs Act, 1969.

From conscientious study of section 30 of Sales Tax Act, 1990 and sections 228 to 230A of the Income Tax Ordinance 2001, it is observed that the legislature appoints under these Sections Officers of different organs of FBR as Officer of Inland Revenue for exercising powers under the respective Sections of the Sales Tax Act, 1990 for which separate statutory Notification is issued and under different Sections of Income Tax powers by these Officials has to be exercised as expressed in 207 of the Income Tax Ordinance 2001. In these Sections respondent No. 2 figures nowhere confirming that he is not empowered to exercise powers under the charging section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001.

To further elaborate and settling the issue to its logical conclusion, I inscribe by referring to section 6 of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001 through which the Collectorate is empowered to collect the Taxes on the imported goods as like custom duty on the value determined under section 25 of the Customs Act, 1969. The said Sections least empowers the Officers of Customs including the respondents to initiate adjudication/recovery proceeding for the short collected/paid Sales Tax and Income Tax either due to collusion or connivance or inadvertence, error or misconstruction. For proceeding for these type of recoveries a show cause notice has to be issued under the Provision of section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001. The authority to issue show cause notice under section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001 are Officer of Inland Revenue and the Commissioner of Income Tax. The respondent No. 2 assumed the powers not vested with him. The fact of matter is Clearance Collectorate have powers to collect Sales Tax and Income Tax as duty at import stage not post importation. As regards to the plea that customs is empowered to recover the short paid amount post clearance under section 202 of the Customs Act, 1969 is based on mistaken belief. The Clearance Collectorate could recover the amount from the amounts lying with it of the importer upon receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under section 48 of Sales Tax Act, 1990 and section 140 of the Income Tax Ordinance for recovery of the adjudged amount of taxes by the competent Officer of LTU/RTO after due process of law.

On the strength of above deliberation, it is my considered opinion that the Clearance Collectorate does have the authority to collect Sales Tax and Income Tax at import stage in the capacity of collecting agent and can recover escaped/short payment paid Custom Duty and Regulatory Duty levied on the imported goods under Section 18 of the Customs Act, 1969 under section 202 of the Customs Act, 1969 after due process of law, but have no powers to adjudicate the cases of short recovery of Sales Tax and Income Tax under sections 11 and 162(1) ibid of the Act/Ordinance respectively. None of the respondents have the powers to recover the arrears of these Taxes at their own, unless they are in receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under sections 48 and 140 ibid. Resultant adjudication proceeding under section 11 of the Sales Tax, 1990 and section 148 of the Income Tax Ordinance, 2001 (as mentioned in the Show Cause notice) is not legal, justifiable and tenable in the eyes of the law and inconsonance with the reported/unreported judgments incorporated here-in-below:

M/s. AGP (Pvt.) Ltd. v. Additional Collector of Customs, Karachi reported at 2011 PTD (Trib.) 110, it was held that:

"Escaped 'advance tax' cannot be followed and/or recovered by the 'customs Officials' under the powers conferred upon them under section 148(5)(6) of the Income Tax Ordinance, 2001, rather it is the Commissioner of Income Tax who under section 162 of the Income Tax Ordinance, 2001 can follow and collect the short recovery of any tax chargeable under section 148(5)(6) of the Income Tax Ordinance, 2001."

Similarly, the Customs Appellate Tribunal, Islamabad Bench in the case of M/s. Global Marketing Services and another v. Model Customs Collectorate and another reported at PTCL 2010 CL 564 held that:

"Only the Commissioner of Income Tax can exercise his powers under section 162 of the Income Tax Ordinance, 2001, on account of default or non payment of tax or if there is a lapse on the part of collecting officer, it could not be said that the collecting Officer can himself automatically presume the jurisdiction of recovery of amount of Income Tax on the basis of assumption or being the Officer of Customs or as a collecting Officer under section 148 of the Income Tax Ordinance, 2001, until the specific powers have been given to him under the law. Hence, it is observed that the Collector of Customs do not have the authority to recover the Income Tax later on but he is only getting the power of collection of tax under section 148 of the Income Tax Ordinance, 2001 therefore mere collection does not mean that he can go for the recovery at the later stage, if the default is made by the persons. To whom the amount of Income Tax is due, the best possibility of recovery according to scheme of law is that after realizing the amount of Income Tax in form of audit or investigation, the collecting Officer can refer the matter to the Commissioner of Income Tax for taking the action of recovery under section 162 of the Income Tax Ordinance, 2001. This is also a settled principal of law that a person cannot be tried on the same offence by two forums, he could be tried only where the clear cut provisions of law are available, therefore, in my opinion Section 148 of the collection to the Customs Department and the power of recovery in case of default under section 148 of the Income Tax Ordinance, 2001 vests with Income Tax Department and the Commissioner of Income Tax as prescribed can go for recovery."

"The power to collect the advance Income Tax under section 148(5) of the Income Tax Ordinance, 2001 cannot have the effect of converting Income Tax into Customs duty. Merely providing the manner of collection of tax as an advance tax under any tax enactment, the nature of the tax could not be changed, hence, the short recovery of any tax collectable under section 148(5)(6) of the Income Tax Ordinance, 2001 to a person in form of short collected short levied or not so collected, either on account of mis-declaration of the importer, or, on account or error, or in-advertence or under mistake, vests with the Commissioner of Income Tax along under section 162(1) of the Income Tax Ordinance, 2001. The Collector of customs do not have the authority to go for the recovery, it is the only the Commissioner of Income Tax alone under section 162(1) of the Income Tax Ordinance, 2001. The Collector of Customs do not have the authority to go for the recovery, it is the only commissioner of the Income Tax who can start the proceedings of recovery against the person in case of default on short collected, short levied or not so collected, either on account of mis -declaration of the importer, or on account or error, or inadvertence or under mistake, so the adjudication by the respondent's to the point of recovery of Income tax against the appellants is not legal, justifiable and not tenable in the eye of law and the exercising of jurisdiction on this point by the respondent and also the adoption of recovery procedure by them are hereby set aside."

"It is declared that the respondent's wrongly assumed the jurisdiction on the show cause notice and over the corrigendum, therefore, their exercise of jurisdiction was not legal justifiable and also not within the four corners of law. It is further declared that the respondents action/procedure for recovery to recover the amount of Income Tax from the appellants is also not legal, vide ab initio without any legal jurisdiction/authority and the same is also against the mandatory provision of law."

This judgment was challenged before the Islamabad High Court through Customs Reference No. 01/2010 by the Collector of Customs, Islamabad and was dismissed by the order dated 15.05.2013, while answering all the questions in negative and against the petitioner. Similarly, Bench-I of this Tribunal held in reported judgment 2014 PTD (Trib.) 299 M.I. Traders v. Additional Collector of Customs held that

"It is my considered opinion that respondent does have the authority to collect sales tax, Income Tax and Federal excise duty at import stage. In the capacity of collecting agent and not empowered to adjudicate the cases of short payment/recovery due to any reason as expressed in respective Sections of the Acts/Ordinance, hence the contention of the respondent representative that customs is empowered to adjudicate the cases of sales tax, income tax and Federal Excise Duty is not legal, justifiable and tenable in the eyes of law. Instead void and ab initio and coram non judice."

In the issue similar to subject appeal the Hon'ble High Court of Sindh held in reported judgment 2004 PTD 801 Al-Haaj Industrial Corporation (Pvt.) Ltd, Peshawar v. Collector of Customs (Appraisement) that:

"it already stand decided that merely by providing manner and time of collection of tax under any tax enactment, the nature of the tax shall not be changed ; meaning thereby that if advanced tax under section 50(5) of the Ordinance can be collected as customs duty and can be recovered by the Customs Officials under section 202 of the Customs Act, 1969 it will not change the nature of the tax and the income tax shall not become the custom duty... the power to collect the advanced income tax under section 50(5) of the Ordinance by the Collector of Customs, shall not have the effect of converting the income tax into customs duty and consequently the customs Officials shall be empowered by virtue of the provision contained in the income Tax and Customs Act, merely to collect the determined amount of tax and shall not have the Authority to resort the chargeability or assessment of a tax. When the income tax shall not be changed into customs duty, the applicability of section 156 of the Customs Act, 1969 shall be excluded as a logical conclusion.

Similarly, the Division Bench of High Court of Sindh in an unreported case of M/s. Lucky Cement Ltd. v. Federation of Pakistan and others through judgment dated 26.02.2013 in C.P. No. D-216/2013 set aside and quashed the proceeding emanating out of FIR registered under the Customs Act, 1969 before the Court of Special Judge Customs and Taxation, Karachi by exercising the jurisdiction under Article 199 of the Constitution. The FIR in the matter has been registered for the alleged evasion of advanced Income Tax liable to be deducted at import stage. Inspite of reaching to the conclusion that the petition was liable to pay advance tax at import stage, held in paras 25 to 28 that:

"25- The FIR has been registered by invoking clauses (14), (14A) and (77) of section 156(1) of the Customs Act. Now clause (14) makes a criminal offence of a violation of section 32(1) and clause (14A) makes a criminal offence of a violation of section 32A(1) provides as follows: "if any person, in connection with any matter of customs...." And then follows the prescribed acts that are criminalized in clause (14). Section 32A(1) opens as follows "if any person, in connection with any matter related to customs...." And again, then follow the prescribed acts that are criminalized in clause (14A), it will be seen that it is of the essence in each case that the offence should have been committed in connection with any matter of or relating to customs. In our view, this essential element is entirely, and necessarily, missing in the present case. Whatever is done in terms of section 148 is in connection with or relating to income tax and not to customs. The jurisdiction conferred on the Collector of customs is obviously only by way of administrative convenience. He is a creature of the Customs Act and is empowered and obligated under that statute to collect, and if necessary recover and enforce, customs duty. The 2001 Ordinance (like the 1979 Ordinance) found it expedient to empower him to a carefully limited extent in respect of collection of advance income tax. But the fact that the Collector of Customs is dealing with such collection does not make the matter of it a matter of or relating to customs. It remains and retains its character of being a matter exclusively of income tax. Since a key element, laid down at the very beginning of sections 32 and 32A is entirely (and necessarily) not applicable in relation to section 148, it follows that no offence under the former provisions could be made out for the purposes of clauses (14) and (14A) section 156(1) of the Customs Act in respect thereof.

26. Clause (77) of section 156(1) has three sub-clauses of which only the first could conceivably apply in the present case this provides as follows (emphasis supplied).

"if any person counterfeits, falsifies or fraudulently alters or destroys any declaration, statement or documents in the transaction of any business relating to the customs or any seal, signature, initials or other mark made or impressed by any Officer of customs in the transaction of any business relating to customs" [he then commits an offence]

As the portions emphasized indicate, the same reasoning applies in relation to clause (77) as just noted in relation to section 32/clause (14) and section 32A/clause (14A), therefore, it likewise follows that no offence under this clause could be made out in respect or for purposes of anything done in relation to section 148.

27. it is also pertinent to note that in the FIR, itself, in para No.9 where the nature of the offence has to be stated, it is noted as follows: "attempt to evade Income Tax @ 5% amounting to Rs. 44795897/- through fraudulent documentation by misusing exemption". Thus, even the customs authorities themselves expressly recognize that the matter was one relating solely and exclusively to income tax and not to anything in relation to or in connection with customs. This serves to further confirms the conclusions already arrived at.

28. In view of the foregoing, we are of the view that the customs authorities had no jurisdiction to register the FIR under the customs Act in relation to the petitioner's claim that it is not obligated to pay advance income tax and in any case, that matter being entirely in relation to income tax could not be an offence under any of the three clauses of section 156(1) that have been invoked. It follows that the FIR is a nullity and completely contrary to law. It cannot be sustained and is liable to be quashed in view of the foregoing position. It is not necessary for us to examine the matter on the merits in relation to the FIR."

The Hon'ble High Court of Sindh in reported judgment 2014 PTD 1963 Shujabad Agro Industry (Pvt.) Ltd. v. Collector of Customs and 8 others held that:

"the customs authorities has no powers under law to restrict release of 'duty paid consignment' on the plea that imported goods were liable to be assessed at the rate of 5% of 'advance tax' [prescribed for one's own manufacturing used] and not at reduced rate of 3% of 'advance tax' [prescribed for industrial used]. Such act of custom authority was without jurisdiction and lawful authority. Custom authorities under law were merely collection agent on behalf of Inland Revenue Department for collection of 'advance tax'. Denying refusal of the consignment on the pretext that income tax is payable @ 5% as against 3% on the basis of reduced rate certificate issued by the Commissioner of Inland Revenue is not only arbitrary, mala fide but also without any jurisdiction, hence illegal, void and ab initio".

The Hon'ble Supreme Court of Pakistan in reported judgment 2006 SCMR 129 titled as DGI&I and others v. Al-Faiz Industries (Pvt.) Ltd. and others held that :

"If the law have prescribed method for doing a thing in a particular manner such provision of law is to be followed in letter and spirit and achieving or retaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted-- each and every words appearing in a Section is to be given effect and no other word is to be rendered as redundant or surplus - when the legislature required the doing of a thing in a particular manner then it is to be done in that manner and all other manner or modes of doing or performing that things are barred -- if the doing of a thing is made lawful in a particular manner the doing of that thing in conflict with the manner prescribed will be unlawful as per maxim "Expression facit cessare tacitum."

I, therefore hold that the exercise of jurisdiction on this point by the respondent No. 2 is also without lawful authority and jurisdiction. Hence, issuance of show cause notice and passing of Order-in-Original is ab initio void and as such coram non judice, The issue No. (vi) is answered in negative.

12.That as regard to issue No. (vi), it is relevant to reproduce proviso to Sub-Rule (6) of Rule 473 of Sub-Chapter VII of Chapter XXI of Customs Rules, 2001, which read as follows:

"Provided that where some discrepancy has been found, the AT GD shall be marked to the concerned Principal Appraiser for further necessary action under the law including initiation of legal proceeding."

Upon bare reading of the proviso, it is vividly clear that in case of discrepancy found in documents submitted for clearance for transit trade or in the particulars of the goods, found contrary upon conduction of examination, the appropriate authority to initiate legal proceeding rest with the Principal Appraiser of DGTT, due to the fact that the goods are in the terminal and those have to be transited without levy of duty and taxes, meaning thereby that no implication on the revenue to the exchequer of Pakistan, the proceeding whatsoever has to be under taken for the rectification of the discrepancy through amendment or by securing insurance guarantee for the amount of duty and taxes levied on the excess found goods on the value determined by the Officials of DGTT on the strength of data maintained under Rule 110 of Customs Rules, 2001 or Valuation Ruling issued by Director, Directorate General of Valuation under the provision of section 25A of the Customs Act, 1969, subject to its return after cancellation upon receipt of T-1, as enunciated in clause (b) of Rule 484-D(1) of Sub-Chapter VII of Chapter XXI of Customs Rule, 2001, bearing cross reference of GD filed in Pakistan and the certificate to the effect that the transit goods had crossed border and the said effect had been fed in the system by the Cross Border Verification Officer (CBBO). Initiation of legal proceeding in case of discrepancy against the importer of Afghanistan through his clearing agent rest with Principal Appraiser of the DGTT. Notwithstanding, it is for the Principal Appraiser, to take cognizance of the discrepancy found in the documents and the goods during the course of examination and in case of need he is competent to issue show cause notice himself to the clearing agent of the importer of Afghanistan for seeking justification for the found discrepancy and if 'i.e. not convincing, pass an observation, for preparation of complaint for submission with the Ministry of Commerce Pakistan for onward submission with the Ministry of Commerce and Industry of Afghanistan (MOCA) for placing before Afghanistan Pakistan Co- ordination Authority in terms of para 2 of Article 3 of Afghanistan Pakistan Transit Trade Agreement , 2010.

In the instant case although the Principal Appraiser of the DGTT took the cognizance of the issue and instead of proceeding himself inspite being competent to do so under para 3(d) of notification No. 886(I)/2012 dated 18.07.2012 opted to frame contravention report instead of complaint and transmitted it to the respondent No. 2, who issued the show cause notice and subsequently passed order in the capacity of Principal Appraiser, to which he is not empowered being a Additional Collector of the Collectorate of Customs Adjudication-II, who is even otherwise not empowered to adjudicate the cases where there is technical violation of import and export having no revenue loss and this has been expressed in para 3(d) of notification No. SRO 886(I)/2012 dated 18.07.2012. It is settled principle of law that the Superior Officer is not empowered to exercise quasi judicial powers of his subordinate in the matter of adjudication and this has been held on countless time by the Superior Judicial Fora in reported judgment referred in para 4(v) supra and which are applicable on the instant case with full vigor. Therefore, I hold that the show cause notice has not been issued by the authority defined in proviso of Sub-Rule (6) of Rule 473 of Sub-Chapter VII of Customs Rules, 2001. Hence, without power/jurisdiction and as such void and ab initio and coram non judice. The issue No. (vii) is answered in negative.

13.That as regard to issue No. (vii), the respondent No. 2 has formed opinion in the order that the goods declaration for transit trade expressed in section 129 of the Customs Act, 1969 and Sub-Chapter VII of Chapter XXI of the Customs Rules, 2001 has to be filed by the importer of Afghanistan under the provision of section 79(1) of the Customs Act, 1969 and for reaching on the opinion, he has placed emphasis on the phrase used therein "for any other approve purpose" according to him this means the GD of Transit Trade also has to be filed under Section 79(1) ibid , astonishingly, he lost sight of its heading which read as "declaration and assessment for home consumption or warehousing". Meaning thereby that the goods declaration for any approved purpose must be and should be for clearance for either home consumption or warehousing, which are (i) Home Consumption (ii) In-Bond Public (iii) In to-Bond Diplomatic (iv) In-to-Bond Manufacturing (v) Ex-Bond Public (Warehouse) (vi) Ex-Bond (Private Warehouse) (vii) Transshipment (viii) Home Consumption on TP (ix) In-to- Bond Private on TP (x) In-to-Bond Public on TP (xi) Safe Transportation (xii) Temporary Import (xiii) Temporary Import on TP (xiv) Re-Importation of Exported Goods under section 22 (xv) Relief, Donation, Charity (xvi) Privilege Person (xvii) Baggage (xviii) Vehicle Baggage and (xix) Carn De Passage. The Goods Declaration for Transit Trade infact has to be filed under section 129 of the Customs Act, 1969 and Sub-Chapter VII of Chapter XXI of the Customs Rules, 2001 and the same cannot be termed even through a figment of imagination as a Goods Declaration for either for home consumption or warehousing. Therefore, it does not falls within the ambit of the phrase "any other approved purpose". Hence, outside the ambit of section 79(1) of the Customs Act, 1969. Therefore, I hold that the formed opinion of the respondent No. 2 is based on inapt interpretation of the phrase "any other approved purpose" and in derogation of the expression of section 79(1) of the Customs Act, 1969. The issue No. (vii) is answered in negative.

14.That as regard to issue No. (viii), it is evident from the Show cause notice and proceedings initiated thereon after the seizure, the allegation attributed against the appellant with reference to the serial No.12 of Show cause notice does not have any warrant of law to be treated as admissible evidence. The show cause notice is silent and specification of bolt has been mentioned only as per serial No.12 of show cause notice in which goods shown as "Benz Wheel Bolt". The department has presumed the classification of the impugned goods being auto parts on the basis of presumption as apparent from the paras 8 and 9 of the departmental comments without disclosing the appropriate H.S Code under which the impugned goods can be classified as auto parts. The department has completely failed to establish that impugned goods "Benz Wheel Bolt" are auto parts as no appropriate H.S Code has been mentioned in show cause notice. It transpires that seizing agency it self is not clear upon the issue of classification of impugned goods. Further with out seeking expert opinion from a recognized auto manufacturer or any competent authority, mere presumption does not tantamount to any violation created in shape of difference between auto parts or otherwise said SRO 151(I)/2004 as well as the show cause notice are in contradictions to each other as in the table to the said SRO at serial No.5 "auto parts (all sorts)" where as in the show cause notice at serial No.12 "benz wheel bolt" has been shown without any sort of evidence to further clarify that the said "benz wheel bolts" are auto parts. The respondents has termed the nuts bolts imported by the appellant with the inscription of "Benz" as auto parts, which are not permitted to be imported in Pakistan for transit to Afghanistan under notification No. 151(I)/2004 dated 10.03.2004. The opinion and finding of the respondent are without any substance due to the fact that auto parts and accessories fall within the ambit of headings 87.01 to 87.08, none of the sub-heading subsequent to 87.08 express "nuts" and "bolts" as motor parts. The appropriate and specific heading of nuts bolts is given in Sub-Chapter 18 of Chapter 73 and which are "Screw, Bolt, Nuts, Coach Screws, Screw Hooks, Revits, Cotter, Cotter Pin, washer (Spring Washer) and similar articles of iron or steel. This mean that similar items as described in sub-heading are also included in this sub chapter inspite not mentioning of the name of the similar articles". The Clearance Collectorate are classifying nuts and bolts if even imported by the manufacturer of automobiles or auto parts dealers under PCT 7318.1690 regularly, further validated from the images, examination report and assessment orders supplied by the appellant of the consignment and which are as follows:-

S.#	Importer Name	Description	GD#/Date	PCT
01	Friends	Assorted Bolts etc.	KCSI-HC-134056-03042013	7318.1690
02	Chawala Ent.	Assorted Bolts etc.	KAPW-HC-93530-24112015	7318.1690
03	Aman Ent.	Automotive Bolts	KAPW-HC-81975-091120I5	7318.1690
04	Aman Ent.	Automotive Bolts	KAPW-HC-73805-27102015	7318.1690
05	S.S. Trading Co	Bolts, Nuts and Clips	KAPE-HC-64825-13112015	7318.1690
05	Khaula Traders	Bolts, Nuts and Clips	KAPW-HC-98470-01122015	7318.1690
05	Crown Corp.	Assorted Screw	KAPE-HC-86839-28122015	7318.1690

In view of the above findings and observations the issue No.8 is being answered in negative.

15.That as regard to issue No. (ix), prior to deliberation on the issue, it is beneficial to reproduce clause (64) of section 156(1) and Rule 484Q of Sub-Chapter VII of Chapter XXI of Custom Rules, 2001 for better understanding of the essence and spirit of these and so the applicability.

(64):

If any person contravenes any rule or condition relateable to section 128 or 129

[Such person including the custodian and inland carrier shall be liable to a penalty up to twice the value of the goods and upon conviction by a Special Judge be further liable to imprisonment for a term not exceeding five years, and the goods in respect of which such offence has been comm itted shall also be liable to confiscation.]

128 and 129

484Q. Penalty under the Act Whosoever commits any contravention of the provisions of this Sub-Chapter shall be liable to be proceeded against under Serial No. 64 and the entries relating thereto, in the table of subsection (1) of section 156 of the Act.

From meticulous study of the above, it is observed that these are applicable in such like situation, wherein the importer of the Afghanistan or his clearing agent remove the goods from the terminal/port in clandestine manner without completion of codal formalities of transit trade envisaged in Afghan Pakistan Transit Trade Agreement, 2010 and Rules embodied in Chapter VII of Chapter XII of Customs Rules, 2001 or pilfered the goods during the course of transit or wherein, cross border certificate is not submitted along with verification of the Afghanistan Government as per the expression of clause (b) of Rule 484-D(1) of Sub-Chapter VII of Chapter XXI of Customs Rules, 2001. In these circumstances the concerned person shall be charged under section 2(s) and Section 129 of the Customs Act, 1969 and have to award punishment of the criminal intent under clause (64) of section 156(1) of Customs Act, 1969. The case in hand is not of the one deliberated upon, instead is a case where excess goods found during the course of examination as against shown in the goods declaration for transit trade and those goods are lying in the terminal. It is immaterial that the goods so found are in excess as those has also to be allowed to be transited without payment of duty and taxes, upon submission of insurance guarantee of the amount of the leviable duty and taxes on the goods imported for home consumption by a Pakistani importer under the provision of section 79(1) ibid on the value determined by the Officials of DGTT on the basis of value available in data reservoir of the Clearance Collectorate under Rule 110 of Customs Rules, 2001 or with the application of Valuation Ruling issued by Director, Directorate General of Valuation under section 25A of the Customs Act, 1969. Application of Rule 484Q in such like cases is out of context due to the fact that no contravention of the provision of section 129 of the Customs Act, 1969 has been made by the appellant. Beside Rules framed for the clearance of transit trade goods cannot be made a tool for creating impediment in implementation of the provision of the statute. Although these are to be complied substantially "but they are not to be applied and operated as "stumbling block" instead of "stepping stones" they should also not be used simply to trap people by technicalities of these rules instead of advancing the purpose for which they are framed. "This has been held by the Hon'ble Supreme Court of Pakistan in reported judgment PLD 1989 Supreme Court 222 Nishat Mills Ltd. v. Superintendent of Central Excise Circle-II and 3 others.

The application of Rules embodied in Sub-Chapter VII of Chapter XXI of Customs Rules, 2001 in the case of appellant has been made as stumbling blocks, on the presumption that the excess found goods shall be pilfered during the course of transit. No case can be initiated either on assumption or presumption, rather should be based on solid tangible evidence. The respondents were not within their right to hold the consignment nor to confiscate in the light of the judgment of the Supreme Court of Pakistan reported as PLD 1993 Karachi 93 Najab Zarab Ltd v. GOP and 1996 SCMR 727 FOP v. Jamaludin to clear the stock involved in the petition for immediate transit to Afghanistan inspite of the objection of the Government of Pakistan that in these tyres of Indian origin were imported and presumption was that that these shall be smuggled back to Pakistan and the Hon'ble High Court of Sindh in order dated 27.10.2010 in C.P. No. D-2410 of 2010 to allow transit of the seized liquor by the Directorate General of Intelligence - FBR, shown in Goods Declaration for Transit Trade as mineral water. In my view the proper course which should had been adopted by the respondent would had been to allow the transit and report the said fact to the clearance port of the Afghanistan through diplomatic channel. It is of vital importance to adduce that none of the Customs Authorities operating at Karachi for clearance of the imported goods and Enforcement and even Directorate General of Intelligence and Investigations-FBR are not empowered either to hold or detain or examine the goods meant for transshipment under the provision of section 121 of the Customs Act, 1969 which is synonymous to section 129 and read as:

"Transshipment of goods without payment of duty:- (1) Subject to the provision of section 15 and the rules, the appropriate officer may, on application by the owner of any goods imported at any customs station and specially and distinctly manifested at the time of importation as for transshipment to some other customs-station or foreign destination, grant leave to transship the same without payment of duty, if any, chargeable on such goods with or without any security or bond for the due arrival and entry of the goods at the customs station of destination.

That akin to the goods transit to Afghanistan falling under the ambit of section 129 of the Customs Act, 1969, transshipment of the goods for Dry Ports of Pakistan for clearance for home consumption under the provision of section 79(1) ibid have to be allowed without payment of duty and taxes without any security or bond, presently the goods meant for transit to Afghanistan are subject to submission of insurance guarantee to the extent of the amount of duty and taxes leviable thereon under First Schedule to the Customs Act, 1969 returnable after cancellation upon receipt of confirmation to the effect that the goods have been crossed the border. The Customs Officials at Karachi detained a consignment of M/s. Famous Corporation, which was meant for transshipment, on the pretext that substantial mis-declaration has been made by the importer. The importer approached the Hon'ble High Court of Sindh which held in reported judgment 1989 MLD 2322 that "where the goods were meant for transshipment to Lahore Dry Port, it cannot be examined by Customs Officials at Karachi. Customs Officials may confirm the information from the Dry Port Authority where the Customs Official can examine the question whether there has been factually any contravention of the Customs Laws or any other law and may take action against the petitioner if so warranted. If the consignment has already been examined by the Customs Officer at Karachi, the same may be released and may be forwarded to the Dry Port along with report if any. Similarly, in case relating to M/s. M. Hamidullah Khan, the Directorate General of Intelligence and Investigations detained a consignment of transshipment on the pretext that the marks and number of the packages on the bill of lading are not in accordance with the marks and number available on the packages of the goods and as such they are empowered to examine the goods for framing contravention report for the purpose of adjudication. The importer filed a petition in the High Court of Sindh which held in reported judgment 1992 CLC 57 M. Hamidullah Khan v. Directorate General of Customs intelligence and 3 others that " We have already reproduced above the letter containing the instructions issued by the C.B.R. regarding transshipment of imported cargo to up-country dry ports. After going through the same we are of the view, that under sub-paragraph (i) of the above instruction, if the address of the party to be notified to disclosed in the bill of lading as of an up-country destination or the marks and numbers on the bill of lading indicate an up-country destination via Karachi, then in that case the consignment cannot be detain at Karachi. However, if any mis-declaration or suspected contravention is discovered in respect of such consignments. The information is to be conveyed to the respective Collector of customs or Deputy Collector of Customs, Incharge of Dry Port or the Directorate of Intelligence at the dry port. These instructions are applicable both in cases where either the notifying party is indicated in the bill of lading is situated in up-country destination, or the shipping marks on the consignment indicate the up-country destination via Karachi. In the case before us it is admitted pointation that the bill of lading was allowed to be amended under section 45 of the Customs Act and the name of the notifying party has been shown as Allied International, Lahore and therefore in terms of the instruction referred to above transshipment of consignment to the dry Port, Lahore should have been allowed. In our view the absence of shipping marks on the consignment, could not give jurisdiction to the Directorate of Customs Intelligence, Karachi to detain the consignment at Karachi Port when the address of notifying part was shown at Lahore, in such a case if the respondents had discovered any contravention of custom law by the importer they should have allowed the consignment to proceed to its destination namely the dry port at Lahore and notified by the Collector or Deputy Collector of Customs at Dry Port as was required under the law." The High Court of Sindh in yet another judgment reported as 2003 PTD 14 N.B. Trading Company, Sambrial, Sialkot v. Collector of Customs, Appraisement and others held that "where there is an information of contravention of Customs, Law, it is to be passed to the respective Dry Port where the imported consignment is destined to which can take action in accordance with an as warranted in law. The action of Customs Officials at Karachi detaining and reopening the said consignment is legally unsustainable, it is without lawful authority and therefore set aside. Therefore it is being held that, neither any action against the appellant was warranted under Rule 484Q nor clause (64) of section 156(1) of the Customs Act, 1969 and detention and confiscation of the goods is declared to be without power/jurisdiction and lawful authority. The issue No. (xi) is answered in negative.

16.That as regard to issue No. (x), the appellant No. 2 as observed from show cause notice and Order-in-Original and as verbally explained by the learned Counsel, was held guilty of an offence under section 32(1) and (2) of the Act. The charge framed in the notice relates to filing of Good Declaration under Section 129 of the Customs Act, 1969 and Rule 472 of Sub-Chapter VII of Chapter XXI of the Customs Rules, 2001 on the strength of documents supplied by the importer of Afghanistan showing goods of 4 different description weighing to 25800 kgs, which were accordingly assessed and allowed out of charge after securing insurance guarantee, which were subsequently upon examination found to be 17 in numbers of altogether different description i.e. 13 items were found in excess. The appellant No. 2 filed the GD under his specified duties for which he has been accorded License by the Licensing Authority, the assertion is that he should had shown the found goods at the time of filing GD. Since, he has not done that the provision of section 32 of the Act is attracted. According to the show cause notice itself, and construing it in the light of the Act, the Customs should have made distinction between a declaration or "a statement in answer to any question put" and a "claim". As regards declaration it means a communication by a person in relation to a business being conducted. The word "declaration" came to judicial scrutiny in the case of Vithoba Syamna v. Union of India reported as AIR 1957 Bom. 321. It was held in that case that the word "declaration" refers to the nature, description and value of goods so that assessing officer can apply appropriate Tariff rate for assessment and charging. On the other hand the word "claim" means a demand for something suppose due to or demanded as a right. Here the only charge against the appellant No. 2 is that he filed GD's on the basis of the documents supplied by the appellant No. 1. There is no charge that his declaration in respect of quantity i.e. unit of measurement has been found be wrong. In the case of Eastern Rice Syndicate v. Collector of Customs (PLD 1959 SC 364), the Supreme Court had held that in order to attract a penal provision of section 39 (now section 32) it must be established that the person who alleged to have made any statement in a documents submitted to the Customs authorities must be false to his knowledge and it would depend upon the facts and circumstances of each case. The assumption of the Customs that violation of the said section did take place appears to be wrong. Infact, the charges against the appellant No. 2 was wholly misconceived as his action does not falls within the operative mechanism of section 32 of the Act. A study of section 129 of the Act reveals that importer of Afghanistan or his agent have to file GD for release of the goods for transit to Afghanistan and the goods are not subject to duty and taxes. It appears that the respondent No. 2 who issued the show cause notice grossly mis understood the scheme of Transit Trade meaning an operative mechanism of the section 129 of the Act and Sub-Chapter VII of Chapter XXI of the Customs Rules, 2001. The liability of a clearing agent during the course of clearance of the consignment has to be evaluated under the provision of sections 207, 208 and 209 of the Customs Act, 1969, which indicate that an agent represent his principal and until and unless any direct evidence is attributed against him or when department is not able to prove any criminal intent on his part, he cannot be penalized under the general provision of the Customs Act, unless he violates the governing condition of his License and this stood validated, from the judgment relied upon by the appellant No. 2 and are referred in para 5(iv to v) supra are fully applicable on the case of appellant No. 2 and observation made by their lordship in 2002 YLR 2651 holding that "to hold the clearing agent liable for an act of commission and omission on the part of the importer will require a clear findings based on legally acceptable evidence of his being an active and conscious party to the manipulation. In normal course of his business a clearing agent files a bill based upon the documents and information provided by the importer. He cannot be presumed to be privy to any illegal arrangement, which the importer may have coined or had intended in his mind for that purpose some evidence of his direct involvement will have to be brought on record. Particularly when it is not shown that the clearing Agent was directly or indirectly a beneficiary of evasion of taxes. With this I answer to issue No. (x) in negative.

18.It is of paramount importance to adduce that it is settled proposition of law that a thing should be done as it is required to be done or not at all as held by Superior Court of Pakistan in umpteenth reported judgments .The Apex Court held in judgment PLD 1971 Supreme Court 61 "neglect of plane requirement of an absolute statutory enactment prescribing how something is to be done, would invalidate thing being done in some other manner". The said ratio was maintained, in the case of E.A. Avans reported as PLD 1964 SC 536 "where it has been unambiguously and categorically held that if the doing of a thing is made lawful in a manner than doing of that thing in conflict with the manner prescribed will be unlawful." The Hon'ble Apex Court in 2001 SCMR 838 "while considering the impact of violation or non-observance of the method prescribed by law for doing an act in a particular manner or mode, such provision of law is to be followed in letter and spirit and achieving or attaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted. The same observation has been made by the Hon'ble Supreme Court of Pakistan in the Civil Petition filed by Director General of Intelligence and Investigation and others v. M/s. Al-Faiz Industries (Pvt.) Ltd. and others reported as 2006 SCMR 129 "if the law had prescribed method for doing of a thing in a particular manner, such provision of law is to be followed in letter and spirit and achieving or attaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted." The super structure built on such foundation no matter how strong it is has to fall. Refer to PLD 1996 Karachi 68, which laid down that "where the initial order or notice was void all subsequent proceedings, orders or super structure built on it were also void.

19.In view of the above discussion, observations and gaining strength from the law laid down by the Superior Judicial Fora. I hereby vacate the impugned show cause notice, and set aside the order passed thereon, during the hierarchy of the customs being illegal, void and ab initio, appeals are allowed and I direct the respondents to allow transit of the goods shown and found in the GD/examination upon securing insurance guarantee of the amount of leviable duty and taxes under First Schedule to the Customs Act, 1969 on the value determined on the basis Of data available in the reservoir maintained under Rule 110 of the Customs Rules, 2001 or with the application of Valuation Ruling subject to return of that after cancellation upon receipt of confirmation of crossing border of the goods. The appellant may apply to the relevant authority for a delay and detention certificate which application shall be considered and disposed of by the said authority strictly in accordance with law and in the light of section 14-A(2) of Customs Act, 1969.

20.Judgment passed and announced accordingly.

SL/41-Tax(Trib.)Appeals allowe