MUBASHIR ENTERPRISES, KARACHI VS COLLECTOR OF CUSTOMS, MODEL CUSTOMS COLLECTORATE APPRAISEMENT (WEST) CUSTOMS HOUSE, KARACHI, 2018 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 460 (2017)

Customs Act (IV of 1969)---

----Ss. 25, 32(5)(e), 79, 80 & First Schedule, R.2(a)---Determination of customs value and classification of imported goods---Import of "Compact LCD/LED Display Panel 32 inch" and declaring same under PCT Heading 8529.9090 at the unit price US$ 29.00; whereas same were assessed by the department at the unit price US$ 72.00 under PCT Heading 8528.7212---Goods declaration was placed before the Classification Committee, which decided that the goods were classifiable under PCT Sub-Heading 8528.7212, in terms of R.2(a) to the General Rules for interpretation to First Schedule to Customs Act, 1969---Appeal filed by the importer against said decision of Classification Committee, had been dismissed by the Collector of Customs (Appeals)/Appellate Authority below---Contentions of importer were that; LED/LCD panels, could not display any image or video and even, could not amplify any sound, therefore those panels were used in the manufacturing of television sets; that importer itself was manufacturer of television sets and in order to develop aforesaid parts into television sets, importer separately imports built-in-system card (Receiving apparatus) back cover, speakers etc.---"Compact LCD/LED Panels" were always assessed and cleared by the Customs Authorities under PCT Heading 8529.9090, and that consignments of other importers were cleared under said PCT Heading---Stance taken by the Department was that in the light of R.2(a) of the General Rules for Interpretation to the First Schedule to Customs Act, 1969 "LCD/LED" had essential character of a television and was qualified to be classified under PCT Heading 8528.7212---Contradictory position taken by the department was incomprehensible---Importer was also importer-cum-manufacturer, who had been issued provisional certificate by Directorate of Input Output Co-efficient Organization to import "Compact Panel PDP/LCD/LED---Said provisional certificate was adequate evidence that the importer was a manufacturing unit and Department's contention that importer was not manufacturer, was incorrect---Two sets of classifications could not exist one for importers-cum-manufacturers and other for the commercial importers---Value was to be determined in the light of methods as prescribed under S.25 of the Customs Act, 1969---Department, in the present case, had not highlighted as to what were the basis of assessing of goods of the importer at value US$ 73.80 per piece---Held, value of US $ 73.80 per piece was arbitrary and without any legal basis---Discriminatory treatment had been meted out to the importer by the Department---If the "Compact LCD/LED Panels" imported by importers-cum-manufacturers, were classified under PCT Heading 8529.9090, there was neither any legal ground nor rationale as to why the same item imported by the appellant/importer should not be classified in the same PCT Heading---Article 10-A of the Constitution, guaranteed fair trial which also included non-discriminatory approach by the competent authority for the contesting parties---No doubt, preferential treatment was given to importers-cum-manufacturers in order to promote industry; however that could not be allocated by different classification headings in Pakistan Customs Tariff for the commercial importers and for the importers-cum-manufacturers---Imported "Compact LCD/LED Display Panels" were without television reception apparatus and were not television sets, hence, were classifiable under PCT Heading 8529.9090 as claimed by the importer---Impugned order being sketchy and non-speaking was set aside, in circumstances.

1989 SCMR 353 and 2011 PTD (Trib.) 110 ref.

Atif Zia for Appellant.

Masood Ahmed, A.O. for Respondents.

JUDGMENT

MUHAMMAD NAZIM SALEEM, MEMBER TECHNICAL-II.--This order disposes off five (05) Customs Appeals Nos. K-988 to 992/2015 directed against Orders-in-Appeals Nos. 10074 to 10077/2015 and No. 10073/2015 both dated 08.05.2015 passed by the Collector of Customs (Appeals), Karachi. All the appeals involve identical issues of law with slight variation in facts. In view of aforementioned position, the same were heard together and are being decided through this common order in the light of judgment of the Hon'ble High Court of Sindh in Customs Reference No. 157 of 2008 - S.M. Naqi son of Syed Muhammad Hussain, Karachi v. Collector of Customs (Adjudication-I) and others. In order to avoid any confusion, we would discuss facts of Customs Appeal No. K-989/2015.

2.Brief facts of the case as given in the impugned Order-in-Appeal, are that the Appellant imported a consignment of "Compact LCD/LED Display Panel" 32 inch and declared the impugned goods under PCT heading 8529.9090 at the unit price US $ 29.00, however, the same were assessed by the Respondent Department at the unit price US $ 72.00 under PCT heading 8528.7212.

3.The GD was placed before the Classification Committee. The Classification Committee decided the matter through Public Notice 13 of 2014 dated 18.11.2014 concluding that the impugned goods are classifiable under PCT sub-heading 8528.7212 in terms of rule 2(a) to the General Rules for Interpretation. The appellant feeling aggrieved filed an appeal before the learned Collector of Customs (Appeals), Karachi who passed order as under:--

"I have examined the case record. The appellants imported and declared the goods as Compact LCD/LED panels under heading 8529.9090, as TV parts, vide GD number KAPW-HC-63004, dated 28.10.2014. The subject GD was assessed provisionally on 06.11.2014 under section 81 of the Customs Act, 1969 as matter of classification was pending in the classification centre. The matter of classification was decided vide public notice 13/2014, dated 18.11.2014. Accordingly the assessment was finalized in the light of public notice under heading 8528.7212. The appellants have assailed this decision as arbitrary and claimed that it was change of practice retrospectively therefore not legally valid. It is on the face of record that another GD by the appellants, which is impugned in linked appeal i.e. KAPW-HC-28176 dated 26.08.2014 was assessed provisionally on 06.09.2014 and finalized on 11.09.2014, on the basis of report by committee of experts, two months before the issuance of Public Notice. Even otherwise the appellants have been collaborating and appearing before the classification committee. Therefore there was no abrupt change in practice, particularly after assessment of GD. No. 28176 on 11.09.2014 has attained finality therefore the question of retrospectively does not arise. The appellants have also challenged the decision of Classification Committee and the Public Notice 13/2014, on technical grounds, however this is not the relevant forum to review this decision.

The appellants have further cited their three GD's i.e. KAPW-HC 26157, KAPW-HC-169335, KAPW-HC-123230, wherein identical goods were cleared under heading 8529.9090, however it is noted that all these are dated prior to finalization of GD, KAPW-HC-28176. In their rejoinder to parawise comments, the appellants cited some more GD's by other importers and stated that they are being discriminated and identical consignments are being released by the same Collectorate under heading 8529, 9090. The DR after examination of GD's No. KAPW-HC-64029, 122721, 104356, 140070, 121182, clarified that those GD's pertained to M/s. Unique, M/s HNC, who are approved importer-cum-manufacturers, who have been issued certificate by IOCO under S.R.O. 565(I)/2006. The parallel can not be drawn between imports by the appellants and those under S.R.O. 565(I)/2006 as the latter allows concession to importer-cum-manufacturers to import even SKD Kits for assembly of Plasma TV sets/LCD panel sets, (imported without packing materials, cartons, boxes, brochures and printed materials).

In view of the afore-said discussion, it is held that there is no merit in the appeal, assessment finalized by respondents is upheld.

This order shall apply mutatis mutandis on the following cases having the same facts, circumstances and points of law.

4.Feeling aggrieved, the Appellant filed an appeal before this Tribunal on the following grounds.

That whether the rejection of declared value of goods and fixation of enhanced value without disclosing adequate material and without allowing opportunity of defense is arbitrary, whimsical, capricious and in complete disregard of Section 25 of Customs Act, 1969.

That whether the rule 2(a) of General Rules of Interpretation to First Schedule to Custom Act, 1969 is validly applicable in the absence of essential character of TV Set and when devoid of equipment necessary for reception.

That whether Public Notice 13 of 2014, dated 18.11.2014, based on invalid foundation, is contrary to law and of no legal effect.

That whether the learned respondent is lawfully authorized to abrupt change in classification with retrospective effect in violation of Supreme Court directions in case law reported as 1989 SCMR 353, and disregard the directions contained in Para 74 of CGO 12 of 2002 to the effect that change if any shall be applicable from the date of notification, when misconstruction and misinterpretation of relevant law is not involved.

That whether the finding of the learned respondent that the assessment on GD 2816 on 11.09.2014 (which is also under appeal) had attained finality even before the issuance of Public Notice No. 13 of 2014 dated 18.11.2014 is valid, when the assessment made on the said date was in the nature of provisional assessment, and the matter of determination of correct PCT rested on the later recommendation of said committee.

That whether the directions of FBR in CGO is binding on the respondent under section 223 of Customs Act, 1969.

It is therefore prayed in the interest of justice and fair play, the Honourable Tribunal may kindly order as under:

1. To declare that the rejection of appeal by respondent 3 is unlawful and not sustainable.

2. To declare that the rejection of declared value is inconsistent with the provisions of Section 25 of Customs Act, 1969.

3. That Rule 2(a) of General Rules of Interpretation to First Schedule is not applicable in the absence of essential character of transmission and reception equipment.

4. That the Public Notice issued 13 of 2014 is contrary to law and of no legal effect.

5. To declare assessment claimed under HS Code 8529.9090 as correct and per established past practice.

5.The respondent department filed para wise comments on the grounds of appeal which are detailed as under:--

Briefly, in the instant case the importer Messrs MUBASHIR ENTERPRISES imported a consignment declared to contain "Compact LCD/LED Display Panel Size 32" " with stand Model No. UA32EH4003 under PCT heading 8529.9090 at declared unit value US$ 297- vide G.D No. KAPW-HC-63004 dated 28.10.2014 with self-assessment under section 79(1) of the Customs Act, 1969. The GD was marked for scrutiny in terms of Section 80 of the Customs Act, 1969 and it was found that the imported goods were actually LCD 7 LED TV set a hence correctly classifiable under PCT heading 8528.7212 @ C.D 25% value US $ 73.80/PCS. On the request of the Appellant/Importer the assessing officer assessed the goods provisional under section 81 of the Customs Act, 1969 and the matter was referred to Classification Committee in terms of Section 81(2) of the Customs Act, 1969 read with Rule 440 of the Customs Rules, 2001. The PCT committee provided the hearing opportunity to the Importer. Accordingly, Classification Committee issued public notice bearing No. 13 of 2014 dated: 18.11.2014. The said public notice itself is self explanatory and provided the reason for classification of goods as required under Section 24A of the General Clauses Act, 1897. The goods were finally assessed after the decision of the Classification Committee vide Public Notice No. 13/2014 dated 18.11.2014. It is also mentioned that in compliance of the honorable Federal Tax Ombudsman order was issued.

That in the light of submissions made above, the contents of para (1) of grounds of appeal are incorrect, hence, denied. It is submitted that the Classification Committee provided the hearing opportunity to the Appellant Importer as well as the department and after due hearing issue Public Notice No. 13/2014. No appeal has been filed before the FBR.

That in the light of submissions made above, the contents of para (1) of grounds of appeal are incorrect, hence, denied. It is pointed out that PCT Committee decided the issue of classification considering the goods importer in the light of rule 2(a) of General Rules of Interpretation to First Schedule to Customs Act.

That, in the light of submissions made above, the contents of para (1) of grounds of appeal are incorrect, hence, denied.

That, in the light of submissions made above, the contents of para (4) of grounds of the appeal are incorrect, hence, denied. It is submitted that in the instant case the goods were assessed provisionally under Section 81 of the Customs Act, 1969 and the case was referred to PCT Committee hence the decision of the Committee is clearly applicable to this import.

That in the light of submissions made above the contents of para (E) of grounds of appeal are incorrect hence, denied.

In the light of submissions made above, it is respectfully prayed that the subject appeal may kindly be dismissed. As being time barred and devoid of merits.

PRAYER

It is therefore prayed in the interest of justice and fair play that the Honorable Tribunal may kindly order as under if deemed fit:

1. To declare that rejection of declared value is unlawful and contrary with the provision of Section 25 of Custom Act, 1969.

2. Rule 2(a) of General Rules of interpretation to First Schedule is not applicable in the absence of establishing essential character of finished T.V. Hence the same has not been invoked correctly.

3. That there cannot be two different HS Codes for assessment of the same goods under the same law and Tariff Classification.

4. That the Public Notice 13 of 2014 is based on illegal foundation contrary to law, hence of no legal effect.

5. To declare assessment claimed under HS Code 8529.9090 is correct and in accordance with established practice and cannot be changed abruptly.

6.The Appellant also filed Rejoinder to comments filed by the respondent department as above. The Rejoinder is reproduced hereunder:--

The Appellant is a manufacturer and imported goods are meant for self consumption. The counter submissions in reply served upon us in the last hearing has been perused. The reply furnished is vague, non specific, general in nature, sketchy in a stereo typed manner, with no comments on the legal issues raised in the grounds of appeal like;

1. No comments on Application of rule 2(a) of GRI, when it is admitted by the respondent in Para 6 of P.N 13 of 2014, dated 18-11-2014, (the basic document giving rise to the controversy regarding assessment in question) that "The samples were consistent with LED/LCD television panels without built in system card, back cover, speakers and ribbon wires. On being asked about the built in system card and back cover, the importer replied that the same are also imported separately", whereas, rule 2(a) of GRI, categorically states "Any reference in a heading to an article incomplete or unfinished, provided that, as "presented", the incomplete or unfinished article has the "essential character" of complete or finished article.

When the imported goods do not possess the essential character of finished T.V as presented, that is, it can neither transmit radio waves, nor reproduce on screen of visual images or sound due to missing parts, how it could come within the meaning and scope of Rule 2(a) of GRI, in the absence of reception apparatus. The P.N. 13 of 2014 is contrary to law and of no legal effect.

2. No rebuttal has been filed to refute application of established past Practice in the light of Supreme Court's decision. No abrupt change can be made with retrospective effect. The present as well as past practice is to classify such goods u/h PCT 85.29.9090 and not 85.28.7212, as alleged. Evidences of Past and present practice were duly provided. The matter has already been reviewed by Respondent in a similar case, upholding assessment u/h 85.29,9090.

3. No comments on application of Para 74 of CGO 12 of 2002 which firmly States that any change in practice is to take place from the date of notification and not retrospectively. In the instant case all the G.D are filed prior to the date of notification that is, P.N.13 of 2014 dated 18-11-2014. The learned Respondent has ignored the fact that non-compliance of directions issued by CBR (CGO 12), constitutes violation of section 223 of Custom Act, 1969 on one hand as supported by case law reported as 2011 PTD (Trib.) 110, and on the other against the settled principle of law by superior courts renders the impugned order not sustainable in the eyes of law. Copy enclosed.

4. Legality of rejection of declared value without disclosing adequate material or allowing opportunity of defense, and relying arbitrarily on 60% of Valuation Ruling No. 675/2014 dated 02-05-2014, when such ruling is for branded T.V Sets only, and not applicable and is in violation to rule 107(a) of Custom Rules, 2001.

5. The matter of correct classification and issues involved in these appeals have been decided by the learned Tribunal in favour of the Appellant in the case of this very importer involving the same goods. Ruled correct classification as PCT 85.29.9090, and in line with established past and present practice. No discrimination could be made.

In view of the above, it is prayed on merits to declare P.N. 13 of 2014 as illegal, and void ab-initio, Panels imported as rightly classifiable and as claimed u/h 85.29.9090 as in accordance with established past practice and upheld by this Tribunal in a similar case, while rejection of value w/o opportunity or corroborative evidence as contrary to law and not sustainable. The impugned order is annulled accordingly.

7.The respondent department submitted cross-objections/para-wise comments on the points raised in the Rejoinder as under:--

1. That before making para-wise comments, at the outset, it is respectfully submitted that according to the sub-paras (vi) to (ix) of Para-2 Chapter-II of the CGO No. 12/2002 (annex-A) read with "General Interpretation Rules" of the G.I.R (Annex-B), as envisaged in the preamble of Pakistan Customs Tariff (Act IV of 1969), the Classification Committee's decision on PCT Heading is final unless it is revoked by the Board. That is why, the learned Collector (Appeals) has very rightly pointed out, in paragraph (5) of the Order-in-Appeal, that the appeal before the Collector (Appeals) is not the right forum to assailed the decision of the Classification Committee. Thus, in view of the aforesaid provision of law the subject appeals are not maintainable and liable to be dismissed on this account alone.

2. That on merit of the case and considering the provision of Section 195-B of the Customs Act, 1969, the subject appeals are otherwise not maintainable until and unless the appellants make the payment of duties and taxes as per final assessment.

PARAWISE COMMENTS ON THE REJOINDER:--

(a)That the appellant's contention with reference to the status of manufacturer of T.V Sets is incorrect, hence, denied in the absence of any corroborative documents like monthly Sale Tax Returns, EDB's approval, etc. confirming the manufacturing of T.V Sets. Further, without prejudice to the above even otherwise there is no separate procedure or law for classification of the imported goods for commercial importer or the manufacturers. There is no such discrimination.

(b)That the goods imported by the appellants having essential characteristics of T.V sets, therefore, considering the Classification Committee's decision and Rule 2(a) of G.R.I the appellants' goods are/were correctly classifiable under PCT Heading 8528.7212.

(c)That keeping in view the contents of the Decision of the PCT Classification Committee and the Assessment Order, the Contents of para (3) of the Rejoinder are incorrect, hence, denied.

(d)That keeping in view the contents of para (5) of the Assessment Order and the contention placed before the learned F.T.O. the contents of para (4) of the Rejoinder with reference to "Past-practice" are incorrect, hence vehemently denied. Even otherwise there was no past practice and the recovery proceedings, in terms of section 32(3A) read with section 32(5)(e) of the Customs Act, 1969, are being initiated for all such isolated GDs where less payment of duty/ taxes has been made by the importers. Without prejudice to the above, even otherwise it is a cardinal principle of law that two (2) wrong cannot make one right.

(e)That in the light of submissions made above there is no question of application of Para 74 of CGO 12/2002 on the appellant's case, hence, the contents of para (5) of the Rejoinder are incorrect, hence denied.

(f)That in the absence of any Revision /Review Application on part of the appellants, there is no question to assess the goods at less than the "Customs Value" determined for the T.V. sets (i.e. LED/SMD, etc). Without prejudice, even otherwise the appellants have failed to substantiate their declared value as transaction value within the meaning of subsection (2) read with subsection (1) of Section 25 of the Customs Act, 1969. Further, the issue of valuation is a past and closed matter because the appellants have never pressed the said issue at original assessment stage, neither at F.T.O. stage nor even say anything against the Valuation Ruling No. 657/2014 in the appeal. In the absence of Review application, in view of the recent order dated: 10.11.2015 of the Hon'ble High Court, in the case of C.P No. D-6918/2015 (Danish Jahengir v. Federation of Pakistan and others), the appellants have no case against the V.R.

(g)That the Order dated: 03.12.2015, in Appeals Nos. K-533 and 534/2015, is neither identical on facts nor related to this Collectorate. Even otherwise it is an Order-in-Persona, which cannot be applied as a settled law. Further as per information gathered from the MCC-Appraisement (East), they are going to assail the said order before the Hon'ble High Court, in terms of Section 196 of the Customs Act, 1969, therefore the said order has so far not attained the finality in terms of section 194-B(4) of the Act.

(h)That in view of the submission made above, it is prayed to dismiss the subject appeals as the decision of classification committee is correct and on merits and falls out said the jurisdiction of the Appellate Tribunal.

8.We have heard both the contesting parties as well as examined the relevant record. The central issue involved in the whole controversy is classification of the "Compact LCD/LED Display Panels" imported by the Appellant. The Appellant classified the same under PCT heading 8529.9090 in their Goods Declaration KAPW-HC-63004 dated 28.10.2014, whereas the Respondent Department classified under PCT heading 8528.7212. The unit price declared by the Appellant is US $ 29.00 whereas the Respondent department has assessed the same to US $ 72.00. Before proceeding further, it would be adviseable to examine the main heading of both the aforementioned PCT headings, as such, the same are reproduced hereunder:--

85.28: Monitor and projectors, not incorporating television reception apparatus; reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus.

8528.7212: - - - - Other

85.29: Parts suitable for use solely or principally with the apparatus of heading 85.25 to 85.28.

9.Technically speaking, the Appellant rely on rule No. 1 of General Interpretation of Rules (G.I.R) to First Schedule to Customs Act, 1969 whereby classification of imported items is determined according to terms of the PCT heading and those of relevant section or chapter notes. Therefore, they emphasize that "reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus" means that it must contain some instrument/appliance or mechanism or something else which must be capable of receiving broadcast signals and transforming them into video. To summarize Appellants' contention, the LED/LCD panels cannot display any image or video and even cannot amplify any sound. Therefore, these panels are used in the manufacturing of television sets. The Appellant contends that they are manufacturers of television sets and in order to develop aforesaid panels into television sets, they separately import built-in system card (receiving apparatus), back cover, speakers etc. He further added that they also manufacture built-in system card. The Appellant have also agitated that earlier their consignment of the same item "Compact LCD/LED Panels" were always assessed and cleared by the customs authorities and cleared under PCT heading 8529.9090. They added that consignments of other importers were also cleared under the same PCT heading. However, against past practice, their G.D under reference was assessed under PCT heading 8525.7212 (Television). It is quite relevant to mention here that PCT heading 8528.7212 attracts Customs Duty @ 25% ad val, Regulatory Duty @ 5%, Sales Tax @ 17% and W.H.T @ 6% whereas the PCT heading 8529.9090 stipulates Customs Duty, Sales Tax and W.H.T. @ 20%, 17% and 6% respectively. Besides, there is substantial difference of valuation per item.

10.The stance taken by the Respondent Department is that in the light of rule 2(a) of G.I.R, the "LCD/LED Panels" have essential character of a television, therefore, the same qualify to be classified under PCT heading 8528.7212. Owing to disputes of classification as above, the instant consignment and some other consignments of the same item imported by the Appellant were provisionally released by the Respondent Department in terms of section 81 of the Customs Act, 1969 and the matter was referred to Classification Committee, Custom House, Karachi, constituted by FBR under C.G.O 12/2002 dated 15.06.2002. The said Committee, after certain deliberations wherein the Appellant was also provided opportunity of hearing, after physically comparing LCD/LED Panels with a complete television set, gave its findings through Public Notice No. 13/2014 dated 18.11.2014 that "the Committee has reached the conclusion that the item declared as LCD/LED panels in retail packing, as presented, are appropriately classifiable under PCT sub-heading 8528.7212 in terms of rule 2(a) to the General Rules for Interpretation". It is important to point here that as per above C.G.O, the appeal against the decision/findings of Classification Committee lies with F.B.R. Precisely, because of aforesaid position, the Respondent Department raised objection before the learned Collector, Customs (Appeals), Karachi regarding his competence to hear appeal against the Assessment Order. However, the said authority without offering any comments on this issue, decided the appeal in favour of the present Respondent Department. Here again, they have agitated that the Customs Appellate Tribunal is not competent to entertain appeal against the impugned Order-in-Appeal. In this regard, it is suffice to say that the learned Collector, Customs (Appeals), Karachi did not decide the appeal on the findings of the Classification Committee. The study of the impugned Order-in-Appeal shows that the appeal was filed against the Assessment Order passed by the concerned officer of MCC Appraisement (West), Karachi. The objection of the Respondent department is, therefore, mis-placed. This august Appellate Tribunal has also not entertained appeal against the findings of the Classification Committee rather the appeal is against the impugned Order-in-Appeal. It may, however, be mentioned that the Respondent Department finalized assessment of all G.Ds. of the Appellant, earlier released provisionally, in the light of findings of the Classification Committee discussed above.

11.The scrutiny of impugned Order-in-Appeal reveals that the Appellant forcefully argued before the learned Collector, Customs (Appeals), Karachi against discriminatory treatment being meted out to them by the department as the G.Ds. of other importers were being assessed under PCT heading 8529.9090. They also cited specific G.Ds., however, the learned Collector, Customs (Appeals) did not agree with the contention of the Appellant. To know the grounds for not considering Appellants' point, the operative part of the impugned Order-in-Appeal is reproduced hereunder:--

"The appellants have further cited their three GD's i.e. KAPW-HC 26157, KAPW-HC-169335, KAPW-HC-123230, wherein identical goods were cleared under heading 8529.9090, however it is noted that all these are dated prior to finalization of GD, KAPW-HC-28176. In their rejoinder to parawise comments, the appellants cited some more GD's by other importers and stated that they are being discriminated and identical consignments are being released by the same Collectorate under heading 8529.9090. The DR after examination of GD's No. KAPW-HC-64029, 122721, 104356, 140070, 121182, clarified that those GD's pertained to M/s. Singre, M/s. Unique, M/s. HNC, who, are approved importer-cum-manufacturers, who have been issued certificate by IOCO under SRO 565(I)/2006. The parallel can not be drawn between imports by the appellants and those under SRO 565(I)/2006 as the latter allows concession to importer-cum-manufacturers to import even SKD Kits for assembly of Plasma TV sets/LCD panel sets, (imported without packing materials, cartons, boxes, brochures and printed materials."

The facts pertaining to specific G.Ds, reaction of the learned D.R and findings/observation of the learned Collector, Customs (Appeals), Karachi, as above, confirm version of the Appellant that they are being discriminated. We are not inclined to endorse views of the learned D.R nor findings of the learned Collector, Customs (Appeals), Karachi insofar as Goods Declarations of importers-cum-manufacturer are concerned. There cannot be two sets of classification, one for the importers-cum-manufacturer and other for the commercial importers. The Respondent Department's stance that the Goods Declarations No. KAPW-HC-64029, 122721, 104356, 140070 and 121182 pertaining to Messrs Singre, Messrs Unique, Messrs HNC have been correctly assessed by them with PCT heading 8529.9090 as the said importers are importers-cum-manufacturer, reflects non-professional attitude on the part of concerned customs officers. The situation becomes grave and confusing when we study the Parawise Comments on Rejoinder dated 19.02.2016 filed by the Respondent Department as under:-

"Further, without prejudice to the above, even otherwise, there is no separate procedure or law for classification of the imported goods for commercial importer or the manufacturers. There is no such discrimination."

Another crucial dimension of the same situation is that both D.R and the Collector, Customs (Appeals), Karachi are treating the Appellant as commercial importer which is factually incorrect. The fact on record is that the Appellant are also importer-cum-manufacture. They are assemblers of television sets. Even they have been issued Provisional Certificate dated 08.12.2014 by the Directorate of Input Output Co-Efficient Organization (South), Custom House, Karachi to import "Compact Panel PDP/LCD/LED" as mentioned at S. No. 38 (hi) of concessionary S.R.O. 565(I)/2006 dated 05.06.2006 as amended with SRO 565(I)/2014 dated 26.06.2014 for the manufacturer of Plasma Display Panel (PDP)/Liquid Crystal Display (LCD) Panel/Light Emitting Diode (LED) Panel. The said Provisional Certificate is adequate evidence that the Appellant are a manufacturing unit and Respondent Department's contention that they are not manufacturer, is incorrect.

The contradictory position taken by the Respondent Department, as above is incomprehensible. We feel at loss to observe here that the learned Collector, Customs (Appeals), Karachi has not taken any notice of contradictory and non-professional attitude of the Respondent Department. More importantly, the study of serial No. 38(h) and (hi) of SRO 565(I)/2006 dated 05.06.2006 unambiguously classifies LCD Panel/LED Panel and Plasma Display Panel under PCT heading 8529.9090.

12.We would also like to discuss here findings of the Classification Committee as notified vide Public Notice 13/2014 dated 18.11.2014 based on which all consignments of the Appellants were finally assessed and released under PCT heading 8528.7212. The meticulous study of the same shows that the major thrust of the Appellant was that "Compact LED/LCD Panels" cannot display any image or video and even cannot amplify any sound. This means that according to the Appellant, essential feature of PCT heading 8528.7212 (as claimed by the department) was "reception apparatus" which was not part of the imported "Compact LCD/LED Panels", as such, the same cannot be treated as Television. The learned members of the Committee while concluding their findings are silent on this important aspect of the controversy.

Para 5 of the Public Notice is worth attention. The Appellant contended before the Classification Committee that LCD/LED Panels are classified under PCT heading 8529.9090 in other countries including South Africa, Canada and India, however, the Committee rebutted the said position in an extremely unconvincing and non-professional manner. For convenience, para 5 is reproduced hereunder:--

"The members of the committee scrutinized the details of the case, perused the additional documents presented by the importer and examined the sample as presented before the committee. As far as Trade Tariff of South Africa, same mentions display panels against HS Code 8529, but this classification has been linked with the promotion of local manufacturing industry to which rebate of full duty of permit system have also been linked. The relative value added by the assemblers has been taken into account in arriving at the extent of the rebate. As far as Canadian Tariff, same classifies. Flat panel screen assemblies under heading 85.29 against applicable preferential tariffs. As far concessionary CGO No. 12/2012 dated 17.03.2012 in practice of Indian Customs, the notification is issued on the same pattern as the concessionary SRO 565(I)/2006 dated 05.06.2006 in practice of Pakistan Customs. The concession offered under the concessionary notification is granted to manufacturers in Pakistan, where PCT headings are taken only for reference purposes and actual description of the item is more important to be linked with appropriate classification to be determined by the Assessing Officers."

To comment that South Africa is classifying under PCT heading 8528.7212 as it has linked classification with promotion of local manufacturing industry, is not convincing because as mentioned at para 11 supra, there cannot be two PCT headings; one for commercial importers and the other for the importers-cum-manufacturer. In the case of India the position has been compared with SRO 565(I)/2006 dated 05.06.2006 with the remarks that in concessionary SROs, PCT headings are taken only for reference purpose and actual description of the item is more important to be linked with appropriate classification to be determined by the Assessing Officers. We cannot restrain ourselves to comment that the Classification Committee merely for the sake of rebuttal of Appellant's arguments, has counter-argued in an extremely non-professional and illogical manner. The citation of PCT headings in any concessionary notification are not for 'reference purpose'. These are cited keeping in view description of goods as are covered under such PCT headings. The Pakistan Customs Tariff (PCT) has been made compatible with international HS Code (Harmonized Commodity Description and Coding System) since 2008. The headings under H.S Code are sub-divided upto six digits level whereas further sub-divisions have been created upto eight digit level with a view to meet national requirements. These headings are rigid in nature and can be changed only in special circumstances like guidelines or classification rulings issued by the Nomenclature Sub-Directorate of World Customs Organization (W.C.O.), Brussels, Belgium. In view of aforementioned position, we are of considered opinion that the Public Notice 13/2014 dated 18.11.2014 is a legally deficient document in many ways and is not a worthwhile document in professional terms.

13.In order to appreciate technical side of the imported Compact LED/LCD Panels, its comparison with a T.V set is imperative which has been done by the Classification Committee. For this purpose, para 6 of the Public Notice 13 of 2014 dated 18.11.2014 is reproduced here-under:--

"The samples of complete television set and imported LCD/LED screens were presented before the committee to differentiate between a complete television set and LED/LCD display panel. The samples were consistent with LED/LCD television panels without built-in system card, back cover, speakers and ribbons/wires. On being asked about the built-in system card and back cover, the importer replied that the same are also imported separately. The sample as presented had a rectangular shape with outer border of black plastic. Inside the back plastic border, plastic film type envelop sandwiching LCD (as main viewing screen exactly identical with demonstrated complete television) with rear side composed of a coloured metallic sheet with a number of die punches and holes for mounting of various electronic components, LEDs are also visible between LCD and rear metallic sheet. The front panel comprised a logic card mounted on the top. A table stand was also present inside the carton containing the LCD/LED panel. The carton gave the appearance of retail packing.

The study of above para shows that the Classification Committee observed that "The samples were consistent with LED/LCD television panels without built-in system card, back cover, speakers and ribbons/wires." In fact, the 'built-in system card' contains "reception apparatus". In absence of "reception apparatus", the panel cannot perform function of a television set i.e. receiving signals from the air and after decoding, transforming signals which can be reproduced on the screen as image/video besides converting audio signals which can be amplified through speakers. The Committee has not discussed as to how LED/LCD Panel can perform function of a television set without containing a "reception apparatus (built-in card system)". We are of considered opinion that to consider LED/LCD Panel a T.V set, it is essential that it must contain the "reception apparatus", which is not available in the Compact LED/LCD Panels under reference. Therefore, these Compact LED/LCD Panels cannot be treated as T.V sets by any stretch of imagination.

14.On the issue of valuation, as the Respondent Department has assessed the imported "Compact LCD/LED Display Panels" on value $ 73.80 per piece against $ 29.0 declared by the Appellant, the para wise comments filed by the department on 'Memo of Appeal' reveals that the basis for aforesaid valuation are Valuation Ruling No. 675/2014 dated 02.05.2014. The study of aforementioned Valuation Ruling shows that it relates to LED Television Sets of different Brands like Sony Bravia, Samsung, L.G and Panasonic having specification of 32", however, the values determined range from $ 118 to $ 150 per piece. Therefore, it is not comprehensible as to how the Respondent Department has arrived at value $ 73.80 per piece. We subscribe to plea taken by the Appellant that value is to be determined in the light of methods as prescribed under section 25 of the Customs Act, 1969 and the department did not highlight as to what were the basis of assessing their goods at value $ 73.80 per piece. We, therefore, conclude that value of $ 73.80 per piece is arbitrary and without any legal basis.

15.After discussing facts and legal position at some length, we are led to conclude that discriminatory treatment has been meted out to Appellant by the Respondent Department. If the "Compact LCD/LED Panels" imported by the importers-cum-manufacturer are classified under PCT heading 8529.9090, there is neither any legal ground nor rationale as to why the same item imported by the Appellant should not be classified in the same PCT heading. Article 10-A of the Constitution of Pakistan, 1973 guarantee Fair Trial which also includes non-discriminatory approach by the competent authority for the contesting parties. The learned Collector, Customs (Appeals), Karachi has not been able to handle this issue in a professional manner. The following observation by the learned Collector, Customs (Appeals), Karachi in operative part of the impugned Order-in-Original, is worth notice:--

"The parallel can not be drawn between imports by the appellants and those under SRO 565(I)/2006 as the latter allows concession to importer-cum-manufacturers to import even SKD Kits for assembly of Plasma TV sets/LCD panel sets, (imported without packing materials, cartons, boxes, brochures and printed materials)."

No doubt, preferential treatment is given by the Government to importers-cum-manufacturer in order to promote industry in Pakistan, however, not by allocating different classification headings in the Pakistan Customs Tariff for the commercial importers and for the importers-cum-manufacturer. Needless to mention here that the Appellant are manufacturer as discussed at para 11 supra.

16.During hearing, the Appellant cited a Judgment of Single Bench of this August Tribunal dated 03.12.2015 passed in Customs Appeals Nos. 533 to 534/2015 which also pertains to the Appellant. The parawise comments of the Respondent department on the Rejoinder of the Appellant dated 19.02.2016 state that the said Judgment is not identical on facts with the instant appeal. The fact of the matter is that the cited Judgment not only pertains to the Appellant but involves similar facts and identical legal controversy as involved in the present appeal.

17.The Appellant has cited a Ruling dated 12.10.2006 issued by U.S. Customs and Border Protection Department whereby Plasma Module is to be classified under sub-heading 8529.9089 which provides for "Part suitable for use solely or principally with the apparatus of heading 8525 to 8528: Other". The Appellant have also cited and presented a copy of Order dated 21.12.2012 issued by the United States Court of International Trade, New York wherein the U.S Court held that the V3 and V4 PDP Modules, imported by the Plaintiff (Messrs Samsung) from Mexico between 2004 and 2005 (manufactured in Korea) are flat - panel screen assemblies to be classified under 8529.90.53. According to the said Court, Plasma Display Panel Module (PDP Module), is a component of the television and video monitors and classifiable under 8529.90.53. The judgment also says as under:--

"The proper interpretation of a tariff item begins with the "terms of the heading." General Rules of Interpretation ("GRI) 1. Heading 8529 refers to: "Parts suitable for use solely or principally with the apparatus of headings 8525 to 8528." Headings 8528 includes, inter alia, video monitors and television reception apparatus, which are the relevant products here 8528, HTSUS.' Thus, in order to be classified in 8529, the item must be a part used solely or principally with some other apparatus of headings 8525 to 8528, including video monitors and television reception apparatus."

18.In view of above, we are fully convinced that the imported "Compact LCD/LED Display Panels" are without television reception apparatus and are not television sets hence classifiable under PCT heading 8529.9090 without any shadow of doubt. These Panels are further used in the manufacture of Television Sets classifiable under PCT heading 8528.7212. We are not reluctant to observe here that the Respondent Department has taken position which is full of contradictions and also discriminatory towards the Appellant. The learned Collector, Customs (Appeals), Karachi has preferred silence on the aforestated factual position. More, disturbing is that he has not given his categoric findings/decision on the classification issue which was the moot point in this case. We, therefore, set aside the impugned Order-in-Appeal being a sketchy, non-speaking and non-professional Order along with the Assessment Order on Goods Declaration bearing No. KAPW-HC-63004 dated 28.10.2014. We also consider Public Notice No. 13/2014 dated 18.11.2014 riddled with infirmities hence nullity in the eyes of law. Therefore, we also set aside the said Public Notice. The value of $ 73.80 per piece as applied by the department is declared void having no legal sanctity. The appeal is allowed in aforestated terms.

19.Announced.

HBT/88/Tax(Trib.) Appeal allowed.