KHYBER TEA AND FOOD COMPANY, KATCHERY GATE, PESHAWAR VS DIRECTOR CUSTOMS INTELLIGENCE AND INVESTIGATION, PESHAWAR, 2018 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 2066 (2017)

Customs Act (IV of 1969)---

----Ss. 2(s), 16, 157, 168 & 156---SRO No. 913(I)/2005, dated 30-7-2005---Seizure and confiscation of alleged smuggled goods---Customs Staff seized the alleged foreign origin smuggled goods along with vehicle---Deputy Collector Adjudication, vide order-in-original ordered outright confiscation of the seized goods and released the vehicle against 20% redemption fine---Driver of the vehicle showed the legal import documents along with sales tax invoices to the Customs Official, who denied to accept the said documents---Initially said goods were intercepted by the local Police and thereafter Police handed over the said goods with vehicle to the Customs Officials---Prosecution while not submitting counter affidavit, had admitted the bids narrated by the appellant in his affidavit---SRO No.913(I)/2005, dated 30-7-2005, provided that the Federal Government had withdrawn the powers of Customs Officers entrusted to the Police; in the light of said notification, the Police had no power to detain or stop the goods having documents of lawful possession and legal import---Officers, notified under S.6 of the Customs Act, 1969, could only seize the goods and give it to the custody and care of Customs authorities; whereas, the Police Officers were neither notified nor authorized officers of customs to detect or detain the goods and hand over the same to the Customs authorities---Any such action taken by the Police Officials within the provisions of the Customs Act, 1969 was illegal---Detention of goods by un-notified and unauthorized officers had been termed as "an illegal detention"---Order-in-original, did not show that the documents produced by the appellant were found bogus---Purpose of issuance of show-cause notice was that accused should know about the allegations levelled against him and prepare his defence---Appellant/accused had a right to defend himself and produce the evidence of legal import and lawful possession of the goods---No provision existed in the Customs Act, 1969 and the other laws of the land that accused could not produce the documentary evidence in support of his version at any stage---Seizing Officer by himself had determined the approximate value of the seized goods, however, the determination of the value of the seized goods was the jurisdiction and duty of the Appraiser and not the Inspector of Intelligence and Investigation Wing of the Customs---Duty and jurisdiction of the Inspector Intelligence and Investigation, was to prevent the smuggling, not to determine C.I.F. value of the seized goods---If the law required a thing to be done in a particular manner; it would be legal and valid only if it was done in that manner and not otherwise---In the present case, the determination of C.I.F. value was carried out without lawful authority and jurisdiction and was void ab initio---Appeal, was allowed and authorities were directed to immediately work out the entire sales proceeds that were payable to the appellant accordingly and release the vehicle unconditionally; the redemption fine imposed on the vehicle, was ordered to be remitted.

2007 PTD 157; PLD 1968 Kar 599; PLD 1969 SC 53; PLD 1977 Lah. 1318; PLD 1975 Kar. 482; 2015 PTD 462; PLD 1971 SC 124; PLD 2002 SC 630; 1999 PTD 4126; 2006 SCMR 1713; 1995 SCMR 387; Messrs Hero Tea Company Peshawar v. Collector Customs Appeals Peshawar Appeal No. CUS-1364/PB/2010; 2004 PTD 791; 2012 PTD 1343; 2012 PTD 1632; 2002 PTD 470; 2001 PTD 2097 = 2001 SCMR 1376; 2001 PTD 2982; 2004 PTD 788; 2013 PTD (Trib.) 600; 2016 PTD 80; 2015 PTD 990; 2013 PTD 327 + 600; 2015 PTD 2480; 2007 SCMR 1095; 2008 PTD 60; PLD 2005 Pesh. 214; 2007 SCMR 1256; 2010 SCMR 1408; 2006 PTD 340; PTCL 2005 CL 841; 2012 PTD 428 and 2012 PTD 28 ref.

Syed Pir Alam Shah, Legal Consultant and Fakhr-e-Alam Paracha Managing Director for Appellants.

Naseer Khan Afridi, Superintendent Customs for Respondents.

Date of hearing: 20th April, 2017.

JUDGMENT

CH. MUHAMMAD SHAHBBIR GUJJAR, MEMBER (JUDICIAL):- This appeal filed by Messrs Khyber Tea and Food Company Head Office Ashraf Road, Katchery Gate Peshawar having NTN Number 1021567-7 and STRN No. 0501090208964 against the Order-in-Appeal No. 75/2012 dated 31.03.2012 passed by the Collector of Customs (Appeals), MCC, Peshawar whereby he while maintaining the Order-in-Original No. 115/2011 dated 15.8.2011 dismissed the appeal.

2.Brief facts of the case are that the Customs Intelligence and Investigation FBR Harripur on 02.02.2011, in pursuance of prior information, a Truck bearing Registration No. K-4592 Peshawar was intercepted at Harripur. Search of the vehicle resulted into foreign origin goods (as detailed in the recovery Memo. 13/2011 dated 02.2.2011). On Shahid Khan son of Ghulam Jillani resident of Peshawar (2) Jamshed son of Gul Muhammad resident of Gilgit failed to produce any legal documents/lawful possession of the said goods so recovered. Therefore, the Customs staff seized the foreign origin smuggled goods along with the said vehicle under Section 168 of the Customs Act, 1969 for violation of Sections 2(s), 16 and 157 ibid read with Section 3(1) of the Imports and Exports (Control) Act, 1950 punishable under Section 156(1)(8), (89) of the Customs Act, 1969 read with Section 3(3) of the Imports and Exports (Control) Act, 1950

3Subsequently, after completion of the requisite formalities, the matter was placed before the Deputy Collector Adjudication, Customs Peshawar, who vide Order-in-Original No.115 of 2011 dated 15.08.2011 ordered outright confiscation of the seized goods and released the vehicle against 20% redemption fine @ Rs.200000/-

4.Appeal was filed against the Order-in-Original No. 115/2011 dated 15.8.2011 before the Collector Appeal Customs Peshawar, who dismissed the appeal vide Order-in-Appeal No. 75/2012 dated 31.3.2012

5.Aggrieved from the Order-in-Original No. 115 of 2011 dated 15.08.2011 and Order-in-Appeal No.75 of 2012 dated 31.03.2012, the appellant filed appeal before this Tribunal with the following grounds.

1.That the seized/confiscated goods were lawfully imported legitimately purchased and bonafidely transported duly supported with GDs, Sales Tax Invoices and Bilities. The appellant registered as manufacturer, income tax department as well as sales tax department. The seized goods after mixing, blending, cutting, processing and assembling packed in plastic bags and cartons bearing appellant's firm address and monogram. The Customs department seized the imported goods without detention under section 17 and no notice issued under section 26 of the Customs Act, 1969.

2.That no contention of the prosecution and respondent No. 5 to the effect that on demand the occupants of the vehicle failed to produce any documents of lawful import and bona fide possession does not have any validity and force. Had respondent No. 5, summoned the police staff the real fact would have revealed upon him. Non-calling for the police staff to whom the documents were produced when they intercepted the vehicle indirectly supports the contention of the appellant. Nonetheless, all the relevant documents were produced to the adjudicating authority who failed to verify the same.

3.That respondent No.5, never enquired from the detecting staff as to how the CIF value of the seized goods amounting to Rs.5500000/- was determined and did not bother to know the reasons of 2nd valuation and assessment in one and same case.

4.That respondent No. 5, did not bother to call for the appraiser to know as to how he evaluated the seized goods and why he did not associate the respondent(now appellant) at the time of evaluation and assessment of seized goods.

5.That the value determined by the appraiser is not a fair value having no legal sanctity as the same has not been approved by the competent authority.

6.That order in original passed by the adjudicating authority suffers from infirmity and illegality as the same has been passed beyond the mandatory period as envisaged under Section 179(3) of the Customs Act, 1969.

7.That contents of the Affidavits given the appellant are to be admitted as the prosecution has failed to give counter affidavits.

8.That the provisions of Section 2(s) of the Customs Act, 1969 are not applicable in this case.

9.That the provisions of Section 16 of the Customs Act, 1969 are not applicable in this case because;

(i) the seized/confiscated goods are freely importable.

(ii) there is no prohibition or restriction on the import of the seized/confiscated goods.

(iii) The seized/confiscated goods were supported with legal documents.

10.That the provisions of Section 157 of the Customs Act, 1969 are not applicable in this case because;

(i) the owner of the vehicle was not travelling with the seized vehicle. When intercepted.

(ii) The prosecution did not bring any evidence on record which prove any criminal link or association with the owner of the seize goods.

(iii) The owner of the vehicle was never issued show-cause notice and in absence thereof no penal or punitive action can be taken against the owner of the vehicle no or any redemption fine could be imposed on the vehicle.

6.In rebuttal, the respondent-department filed their parawise comments as under:--

1.Incorrect. At the time of interception of the vehicle the owner/ driver did not produce any GDs, Sales Tax invoices, Bilties to the seizing officer from the recovery memo. The seizing officer accordingly got signature from the owner/driver on recovery memo.

2.No comments.

3.No comments

4.Incorrect. The appraiser was not under obligation to associate the accuse person while assessing the duly and taxes. The Collector or Director valuation has the power to re-examine the assessment made under Section 80 of the Customs Act, 1969 if he is not satisfied. Section 25D of the Customs Act, 1969 empower the Director General valuation to hear appeal if filed by an aggrieved person.

5.Incorrect.

6.No comments.

7.Incorrect.

8.Incorrect.

(ii)Incorrect.

(iii)Incorrect.

7.I have heard both the parties and perused the record with their assistance. On the way to Hawalian the local police of Police Station Hawalian stopped the vehicle. Then the Police officials brought the vehicle along with the driver to Police Station and put the driver into Lock Up and called the Mobile Squad Harripur. Driver of the vehicle showed the legal import documents along with sales tax invoices to the customs officials where the customs officials denied to accept the legal import documents/sales tax invoices Nos. 25, 26, 27,28, 29 and 30 dated 02.2.2011 and brought the vehicle to customs office Harripur and seized the said goods along with vehicle and served notice under section 171 of Customs Act, 1969.

8.It also transpires from the affidavits that initially the said goods were intercepted by the local police of Police Station Hawalian. Thereafter the police handed over the said goods along with vehicle to the customs officials Harripur. There is no any counter affidavit on behalf of seizing officer to till date. It is a settled law if a fact which is not rebutted, it amounts to admission. Reliance takes place on 2007 PTD 157. The prosecution while not submitting counter affidavit has admitted the facts narrated by the appellant in his affidavit and the affidavits produced in support of his version. The goods in question as well as the vehicle was not initially detected by Anti-Smuggling Mobile Squad Harripur but by the Police of Police Station Hawalian. Then the Police Station Hawalian called Customs authority and handed over the vehicle along with said goods in question to the Customs Mobile Squad-Harripur. In the year 2005 by Customs Notification vide SRO. No. 913(I)/2005 dated 30.7.2005, the Federal Government has withdrawn the powers of Customs officers to Police entrusted under section 6 of Customs Act, 1969. In the light of said SRO the police have no power to detain or stop the goods having the documents of lawful possession and legal import. The officers notified under section 6 of the Customs Act, 1969 can only seize the goods and give it in the custody and care of the Customs authorities whereas, the police officers neither notified nor authorized officers of customs within the meaning of sections 2(b), 3, 4 and 6 of the Customs Act, 1969 to detect or detain the goods and handover the same to the customs authorities and any such action taken by them within the provisions of the Customs Act, 1969 is illegal. The detention of goods by un-notified and unauthorized officers have been termed as an illegal detention. In case of an illegal seizure, goods are to be restored to the person from whose possession they were seized. Reliance takes place on PLD 1968 Kar 599, PLD 1969 SC 53, PLD 1977 Lah. 1318 and PLD 1975 Kar. 482.

9.The order-in-original didn't show that the documents produce by the appellant were found bogus. I am not agree with the plea of learned DR that the documents presented were afterthought. If the said documents were afterthought, so why the adjudication officer has issued show-cause notice and why he called upon as to penal action should not be taken against the appellant and why the seized said goods should not be confiscated. The purpose of issuance of show-cause notice is that the accused should know about the allegation levelled against him and he prepared his defense. This is the right of appellant to defend himself and produce the evidence of legal import and lawful possession of the goods. There is no provision in the Customs Act, 1969 and the other laws of land that the accused cannot produce the documentary evidence in support of his version at any stage.

10.The learned DR raised a plea that the salesman of the appellant's company namely Jan Muhammad submitted an affidavit to the seizing officer that he is ready to pay relevant duty and taxes. The learned DR admitted that the affidavit was submitted at the seizing stage. Therefore it cannot be ruled out that said affidavit has been taken forcibly by the seizing officer in order to strengthen his case, such affidavit had not been submitted by the owner of the goods. I have examined the affidavit such affidavit has been submitted before the date of issuance of show-cause notice which also proves that the said affidavit has been submitted at the stage of seizure. Therefore, such affidavit has no value in the eye of law. This plea of DR having no force, therefore, has been turned down.

11.According to the seizure report the CIF value of the seized goods are approximately Rs.5500000/-. However the total duty and taxes involved in the present case are: CIF Value: Rs. 5500000/- 10% CD: Rs 550000/- + 17% ST Rs. 1028500 + 5% IT: Rs. 353925

Total Duty and Taxes: 1932425/=

The seizure report shows that the seizing officer by himself has determined the approximate value of the seized goods however the determination of the value of the seized goods is the jurisdiction and duty of appraiser not inspector of Intelligence and Investigation wing of the Customs. The duty and jurisdiction of the Inspector Intelligence and Investigation is to prevent the smuggling not to determine the CIF value of the seized goods. If the law requires a thing to be done in a particular manner, it would be legal and valid only if it was done in the manner and not other wise. In the instant case the determination of CIF value is without lawful authority and jurisdiction therefore the determination of value the seized goods is void, ab initio. Further the seizing officer didn't associate the appellant during the process of evaluation and assessment of seized goods however it is mandatory for the seizing officer to associate the owner of the goods at the time of evolution and assessment of the seized goods. The adjudication officer and Collector Appeal as well have been failed to adjudge this important aspect of the case. Approximation has no room in the law rather the perfect valuation has the value in the eye of law. Whereas pecuniary jurisdiction of Deputy Collector Customs according to subsection (1) of Section 179 of the Customs Act, 1969 is not exceeding Eight Hundred Thousand Rupees. Admittedly total duty and taxes involved in the present case are Rs. 1932425/- which is more than the pecuniary jurisdiction of the Deputy Collector. Exercise of jurisdiction by authority is mandatory requirement and its non fulfillment entails entire proceedings to be coram non-judice. When statute specifically provides and vests jurisdiction in a particular court, forum or authority, an attempt by any other court, forum or authority to take cognizance of the matter or to initiate any proceedings would render such proceedings non-est in the eyes of law, void ab inito and of no legal effect. Hence reliance takes place on 2015 PTD 462 Sindh High Court, PLD 1971 SC 124, PLD 2002 SC 630, 1999 PTD 4126 and 2006 SCMR 1713.

12.That the green tea, black tea, black pepper, green cardamom, cassia, cloves, cumin seed, Dry Copra, Dry Kajoor, Ispaghol Husk, Dal-e-Mong, Dal-e-Masoor, Stationary paper and tissue paper etc entered into the country by Karachi Sea Port either by the Pakistani Importers or by the Afghan Importers for Afghanistan. The goods which imported for Afghanistan must carries the words "via Karachi in transit to Afghanistan" on the bags, cartons etc under the Afghan Transit Trade Treaty already executed between Pakistan and Afghanistan in 1965. It is in the notice of Customs authorities that the goods which didn't carry the words "via Karachi in transit to Afghanistan" and those are going to Afghanistan. The customs authorities have the power to seize the same. Because it is the violation of Afghan Transit Treaty, 1965. The perusal of record shows that the seized said goods in question didn't carry the words "via Karachi in transit to Afghanistan". And admittedly those goods were not seized on border belt but were seized on settled area i.e. Hawalian. This fact had also been admitted by the Departmental Representative. Then how the customs authorities declared them smuggled one. Moreover, August Supreme Court of Pakistan in its judgment reported in 1995 SCMR 387 held that "If the items alleged to be smuggled by the prosecution were freely available in the open market and import of such goods were not banned in the country presumption could arise that the goods in question were lawfully brought in the country unless the contrary was shown".

13.The DR contended that the said seized goods is a perishable item and there is no capacity in the customs warehouse to store the said goods for such a long time. Therefore, the customs authorities have auctioned the same. The perusal of recovery memo reveals that the manufacturing date was August, 2010 and expiry was July, 2013 of seized 100 bags of black tea. So far as the question of expiry of the seized confiscated blended black tea is concerned in this regard. The learned counsel for appellant produced bill of entry, packing list and bill of lading and commercial invoice. Wherein the date of manufacturing and expiry of black tea were mentioned. From the scrutiny of the bill of entry, packing list and bill of lading etc. it transpires that the life of black tea is 3 years. I agree with the plea raised by the learned counsel for appellant. Reliance takes place on Messrs Hero Tea Company Peshawar v. Collector Customs Appeals Peshawar vide Appeal No. CUS/364/PB/ 2010 judgment dated 12.12.2014 passed by Customs Appellate Tribunal Bench Peshawar. It has been observed that the goods which have already been auctioned then how those goods can be confiscated. In the present case the case property i.e. black tea has already been auctioned before its confiscation. For confiscation the case property must be present before the adjudication authority. However in the present case the case property was not present at the time of confiscation. Therefore on this score too the order-in-original as well order in appeal are not maintainable.

14.The learned DR contended that the sales tax invoice Nos. 25 to 30 dated 02.2.2011 neither mentioned the NTN Number or CNIC Number of purchaser issued by Messrs Khyber Tea and Food Company Peshawar nor his NTN, CNIC Number or his name mentioned in the monthly sales tax return Annex-C (Summary of Sales Invoices) for the month of December, 2010 which is against the SRO 821(I)/2011 dated 06.9.2011 issued by Government of Pakistan Federal Board of Revenue Islamabad which made it mandatory that in case of registered manufacturer, importers, exporters, making taxable or dutiable supplies to unregistered person, shall issue an invoice containing "computerized National Identity Card Number or National Tax Number" of such unregistered person. Thought the FBR has issued the above mentioned SRO but the Government of Pakistan Ministry of Finance, Economic Affairs, Statistics and Revenue Islamabad rescinded the said SRO vide notification SRO 880(I)/2012 dated 17.7.2012, therefore the said plea of DR is turned down.

15.The learned Department Representative contended that the features and contents of recovered seized goods don't tally with the bill of entry. The record has been examined which reveals that, the seized goods were imported by Messrs SPATCO'S Karachi vide GD No. KAPR-HC-37897-08.11.2010, M/s Marc's International Karachi vide GD No. KAPW-HC-37320-1.11.2010 and Messrs Tariq Traders Jodia Bazar Karachi vide GD No. KAPW-HC-37340-02.11.2010 later on which were purchased by the Messrs Khyber Tea and Food Company Peshawar vide purchase sales tax invoices No. (625 dated 22.12.2010 Messrs SPATCOS Karachi), (Invoice No. 113 dated 22.12.2010 Ms. Marc International Karachi) and (Invoice No. 745 dated 22.12.2010 Messrs Tariq Traders Karachi). Further the bilty No. 1510 dated 22.12.2010 also shows that after purchasing the said goods, M/s Khyber Tea and Food Company Peshawar transported the said goods from Karachi to Peshawar through New Punjab Karachi Goods Transport Company Karachi. According to available record the condition of the seized goods at import stage and after manufacturing is tabulated as under:--

16.The learned Departmental Representative raised a question that the repacking was made un-necessarily is also a frivolous while the Messrs Khyber Tea and Food Co. Peshawar being registered with FBR mixed/blended the tea in question in its registered premises at Peshawar and repacked the same in bags. The learned DR produced FBR Income Tax Circular No. 03 of 2009 dated 17.6.2009 Para No. 34 where it has clearly been defined

"Person engaged in packing and repacking have been excluded from the definition of manufacturer"

For the purpose of section 153 of Income Tax Ordinance, 2001 and as per Finance Act, 2009 the packing and repacking activities have been excluded from the definition of manufacturer. It is correct that the Finance Act and the above noted circular excluded the packing and repacking activities from the definition of manufacturer. But the provision of Finance Act, 2009 and the above mentioned circular did not exclude the activities of mixing and blending from the definition of manufacturer. The business activities of Messrs Khyber Tea and Food Company Peshawar is of mixing and blending of various tea with each other in order to create taste and flavor of tea. Thus the business activities of Messrs Khyber Tea and Food Company Peshawar falls within the scope and definition of manufacturer under sections 2(16) and (17) of the Sales Tax Act, 1990, section 153 (7)(iv)(b) of Income Tax Ordinance, 2001 and section 2(25) of Federal Excise Act, 2005 as well. The sections of law ibid reproduced as under;

Section 2 (16) of Sales Tax Act, 1990 provides as under:

"Manufacture" or "produce" includes;

(a)any process in which an article singly or in combination with other articles, materials, components, is either converted into another distinct article or product is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly and includes any process incidental or ancillary to the completion of a manufactured product;

(b)process of printing, publishing, lithography and engraving; and

(c)process and operations of assembling, mixing, cutting, diluting, bottling, packaging, repacking or preparation of goods in any other manner.

Section 2 (17) of Sales Tax Act, 1990 provides as under:

"manufacturer" or "producer" means a person who engages, whether exclusively or not, in the production or manufacturer of goods whether or not the raw material of which the goods are produced or manufactured are owned by him, and shall include--

(a)a person who by any process or operation assembles, mixes, cuts, dilutes, bottles, packages, repackages, or prepares goods by any other manner;

(b)an assignee or trustee in bankruptcy, liquidator, executor, or curator, or any manufacturer, or producer and any person who disposes of his assets in any fiduciary capacity; and

(c)any person, firm or company which owns, holds, claims or uses any patents, proprietary, or other right to goods being manufactured, whether in his or its name, or on his or its behalf, as the case may be, whether or not such person, firm or company sells, distributes, consigns, or otherwise disposes of goods.

Section 153(7)(iv)(b) of Income Tax Ordinance, 2001 Provides as under:

"Manufacturer" for the purpose of the section means, a person who is engaged in production or manufacturer of goods, which includes:-

(a)any process in which an article singly or in combination with other articles, material, components, is either converted into other distinct article or produce is so changed, transferred , or reshaped that it becomes capable of being put to use differently or distinctly; or

(b)a process of assembling, mixing, cutting or preparation of goods in any other manner.

In the light of above provisions of law the status of Messrs Khyber Tea and Food Company is manufacturer. It is understood fact that being manufacturer Messrs Khyber Tea and Food Company Peshawar would change the original packing after mixing and blending of tea. It is the right of manufacturer to change the original import packing after mixing, blending and processing.

The grinding process of spices and their mixing, grinding of leaves of betel nut, green tea, grinding of green cardamom, mixing and grinding of dry fruits i.e. almonds, peanuts, nutmeg, and dry coconut etc for keer, grinding of food grains i.e Dal-e-Mattar, Mung etc., cutting of paper roll and use for different purposes and the act of cutting the tin plates to size, assembling of different parts of sewing machines, assembling of different parts of air conditioner, cutting of broom stick into small size, cutting of leather and making of jackets and ladies purse etc and cutting of cloth and making of garments are the examples of manufacturing.

There is no prohibition on mixing, blending, cutting and preparation under any law of land. So the seizing and confiscation of the tea, spices and dry fruits in question was unlawful. Hence reliance takes placed on 2004 PTD 791 Karachi High Court, 2012 PTD 1343, 2012 PTD 1632, 2002 PTD 470, 2001 PTD 2097 = 2001 SCMR 1376, 2001 PTD 2982, 2004 PTD 788, 2013 PTD (Trib.) 600, 2016 PTD 80, 2015 PTD 990, 2013 PTD 327 + 600, 2015 PTD 2480 and PTCL 2016 CL 132(sic).

17.The learned DR put an allegation that the appellant's company has obtained manufacturing certificate in connivance with the RTO authorities. This allegation of DR is incorrect because the competent authority i.e. Commissioner has issued manufacturing certificate to the appellant's company after observing the whole legal procedure and law. Therefore, the allegations put by the learned DR having no force hence rejected.

18.That the recovered black tea, food grains, spices items, mixed dry fruits was in plastic bags bearing the monogram of Messrs Khyber Tea and Food Company Peshawar along with address, telephone and email which means that the said seized goods in question were locally manufactured. The law of land doesn't permit to detain, seize and confiscate locally manufactured goods. The goods were loaded on a truck were seized within the country as such this goods could not be treated as smuggled goods. Locally manufactured goods and imported goods purchased from the local markets are not liable to confiscation. "Moreover once the goods imported into the country for home consumption and issue a sales tax invoice in respect of imported goods the provisions of Customs Act, 1969 are not applicable because after process of assembling, cutting, mixing and preparation the same is repacked".

19.The prosecution contended that there is non mentioning of the country of origin in the sales tax invoice produced by the appellant is not plausible because there is no column to be mentioned the origin in the sales tax invoice so no need to be mentioned the origin in the sales tax invoice. Reliance is placed on judgment of Honourable Peshawar High Court Peshawar passed in S.A.O. No. 175 of 2004 dated 11.10.2004 whereby his Lordship Mr. Justice Nasir-ul-Mulk has concluded as under; "The sales tax invoice has only mentioned the tea as black tea as distinguished from green tea. In the sales tax invoice the origin of the tea need not be mentioned. The tea imported had been repacked by the importer for distribution to the retailers and, therefore, it was quite un-necessary to mention the countries from which the tea was imported. It was on account of these facts that the Appellate Tribunal as well as the Collector Appeals had found that the tea seized had been lawfully imported and that the burden to prove its lawful import had been duly discharged by the owner on production of the relevant documents".

20.The show-cause-notice in this case was issued on 15.2.2011. The provisions of section 179(3) of Customs Act, 1969 required that the case should be adjudicated within a period of 120 days from the date of show-cause notice. The said period of 120 days expired on 15.6.2011. The period between the issuance of show-cause notice and passing of the order in original is 6 months. Therefore, the order in original is barred by 6 months. Neither the Order-in-Original No. 115/2011 dated 15.8.2011 speaks about any approval of extension of time by the Collector in this Adjudication period. Where law requires a thing to be done in a particular manner, it would be legal and valid only if it was done in that manner and not other wise. It was mandatory to decide the case within the period specified by the Customs Act, 1969. Reliance takes place on 2007 SCMR 1095, 2008 PTD 60, PLD 2005 Pesh. 214, 2007 SCMR 1256, 2010 SCMR 1408, 2006 PTD 340; PTCL 2005 CL 841 (President of Pakistan).

21.The Bill of Entries bearing machine Number KAPR-HC-37897 dated 08.11.2010, KAPW-HC-37320 dated 1.11.2010 and KAPW-HC-37340 dated 2.11.2010 showed that the seized goods were imported by Messrs SPATCO'S 215 Panorama Center, Fatima Jinnah Road, Karachi, Messrs MARC'S International Karachi and Messrs Tariq Traders Jodia Bazar Karachi which was later on purchased by the Messrs Khyber Tea and Food Company Ashraf Road, Katchery Gate, Peshawar vide purchase sales tax invoice No. 625 dated 22.12.2010 (SPATCO's Karachi), invoice No. 113 dated 22.12.2010 (Marc's International Karachi) and invoice No. 745 dated 22.12.2010 (Messrs Tariq Traders Karachi). The bilty No. 1510 dated 22.12.2010 also proved that after purchasing the said goods from all the above importers, Messrs Khyber Tea and Food Company Peshawar transported the said goods from Karachi to Peshawar through New Punjab Karachi Goods Transport Company Karachi. It is evident from the above Bill of Entries that the importers have imported goods and the invoice Nos. 25 to 30 dated 2.2.2011 also showed that Messrs Khyber Tea and Food Company Peshawar also sold out the seized goods which proves that the goods in question were imported. Furthermore all the relevant documents were produced and according to Section 187 of the Customs Act, 1969 as held in 2012 PTD 428 Karachi HC, 2012 PTD 28 QHC the onus of proof lies on the should of the prosecution to proof its case. For convenience of perusal, section 187 of the Customs Act, 1969 is reproduced:--

"187. Burden of proof as to lawful authority etc:---When any person is alleged to have to have committed an offence under this Act and any question arises whether he did any act or was in possession of anything with lawful authority or under a permit, licence or other document prescribed by or under any law for the time being in force, the burden of proving that he had such authority, permit, license or other document shall lie on him."

22.In view of the above discussions I came to the conclusion that the respondent could not prove its case against the appellants regarding violation of Sections 2(s), 16 and 157 of the Customs Act, 1969 read with Section 3(3) of the Imports and Exports (Control) Act, 1950 punishable under section 156(1)(8)(89) of the Customs Act, 1969. Seized goods are notified items but don't fall in the Appendix-A and are not bended items. It is freely importable under the import policy, any presumption of its being smuggled requires direct evidence which is absent in the present case. Consequently, this appeal is allowed and the Respondents are directed to immediately work out the entire sales proceeds that are payable to the Appellant accordingly and release the vehicle unconditionally, the redemption fine imposed on the vehicle is also remitted.

HBT/66/Tax/(Trib.) Appeal allowed.