MSMS TRADING COMPANY, KARACHI VS ASSISTANT COLLECTOR OF CUSTOMS, AFU, MCC, 2018 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 638 (2017)

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

----Ss. 3-DD & 26-A---S.R.O. No.500(I)/2009, dated 13-6-2009---Post clearance scrutiny of record of importer---Officials of Directorate of Post Clearance Audit were delegated the powers under different sections of the Customs Act, 1969 through S.R.O. No.500(I)/2009, dated 13-6-2009---No power, either post clearance scrutiny on audit of the imported consignment was available to the Clearance Collectorate in the presence of Directorate General of Post Clearance Audit---Assistant Collector Customs, while scrutinizing the declaration of the importer, conducted audit while usurping the powers of the Directorate of Post Clearance Audit; which was ab initio, void and coram non judice.

[Case law referred.]

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

----S. 179---Powers of adjudication---Section 179 of the Customs Act, 1969 was clear with regard to determination of the powers of the adjudicating authority on the basis of "amount of duty and taxes involved"---Case involving Rs.1,142,980.00 for obtaining clearance of goods---Competent authority to adjudicate on such a case was Additional Collector of Customs under Cl.(ii) of S.179(1) of Customs Act, 1969---Collectorate of Customs could not issue show-cause notice---Authority defined in S.179(1) of the Customs Act, 1969, had to exercise powers accordingly---In the present case, no notification of the Federal Board of Revenue was presented, empowering the Collectorate of Customs for exercising powers of the Board itself in negation of subsection (2) of S.179 of the Customs Act, 1969, which could not be assumed under any pretext/circumstances---Said lapse rendered order of the Collectorate as without lawful authority and jurisdiction; hence ab initio void superstructure thereupon, had to crumbled down.

[Case law referred.]

(c) Interpretation of statutes---

----Fiscal statute---Such law was to be applied with full authority and given its natural meaning---One had to look merely at what was clearly said and there was no room for any intendment; neither there was equity about a tax nor presumption as to tax; nothing was to be read in, nothing was to be implied---One could only look fairly at the language used.

[Case law referred.]

(d) Customs Act (IV 1969)---

----Ss. 2(a), 80, 83, 193 & 195---Customs Rules, 2001, Rr.438 & 442---Notification S.R.O. No.371(I)/2002, dated 15-6-2002---Assessment of duty---Assessment order passed under S.80, of the Customs Act, 1969 and R.438 Customs Rules, 2001 and clearance order under S.83 of the Customs Act, 1969 and R.442 of Customs Rules, 2001 by the Authorities defined in S.2(a) of the Customs Act, 1969 and Notification S.R.O. No.371(I)/2002, dated 15-6-2002, could not be disturbed by any Authority including Collecorate of Customs for preparing contravention report for adjudication proceedings---Only course available under law for Assistant Collector of Customs (Preventive) was to challenge the assessment order before the Collector of Customs (Appeals) under S.193 of the Customs Act, 1969---Assistant Collector of Customs was empowered to incorporate all the apprehensions, misreading of the facts and contraventions of provisions of the Act/Rules---Assistant Collectorate of Customs (Preventive), instead of following the prescribed method, reopened the assessment/clearance order under S.195 of the Customs Act, 1969---When the right had been conferred on the officer of Customs by the legislature under the provisions of S.197 of the Customs Act, 1969, provisions of S.195 of the said Act, could not be invoked.

[Case law referred.]

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

----Ss. 179 & 180---Powers of adjudication---Issuance of show-cause notice---In presence of appealable order, fresh order could not be passed even in the shape of reassessment order or through issuance of show-cause notice under S.180 of the Customs Act, 1969 while exercising powers under the provisions of S.179 of the Customs Act, 1969---In case of non-filing of appeal against the assessment order, the transaction became past and closed one and attained finality, and could not be disturbed---Impugned show-cause notice was vacated and order passed by the forum below being illegal, void ab initio to the extent of appellant/importer, was set aside.

[Case law referred.]

Nadeem Ahmed Mirza for Appellant.

Ashiq Ali, A.O. for Respondent.

Date of hearing: 31st January, 2017.

ORDER

TAHIR ZIA (MEMBER JUDICIAL-II).---Through this order, I intend to dispose off appeal directed against Orders-in-Original No. 632/2015-2016 dated 20.04.2016 passed by the Additional Collector of Customs (Adjudication-I) Custom House, Karachi.

2.Briefly facts of the case are that appellant imported a consignment of computer hardware components and upon receipt of documents delivered those to his clearing agent Messrs Khurram Brother, Karachi for filing Goods Declaration with the MCC of Preventive under the provision of Section 79(1) of the Customs Act, 1969 (here-in-after to be referred as Act) which he did and was numbered as KAFU-HC-550-05102015, which was selected for examination in terms of Section 198 of the Act and Rule 435 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001 (here-in-after to be referred as Rules). The official posted at Gerry's Shed situated at JIAP confirmed the declaration with the exception of clear marking reading as "invoice not found", consequent to which the Assistant Collector of Customs, Examination transmitted show-cause notice for contravention of Rule 389 of Rules, which was accepted by the appellant in the system and the Assistant Collector of Customs, Examination imposed penalty of Rs. 5,000.00 through a valid order-in-original. Thereafter, the competent authority in exercise of the powers vested through S.R.O No. 371(I)/ 2002 dated 15.06.2002 passed assessment order under Section 80 and Rule 438 of the Act/Rules and directed the appellant to pay leviable duty and taxes of Rs. 125,618.00, which appellant paid on 08.10.2015, consequent to which the Principal Appraiser passed clearance order section 83 and Rule 442 of the Act/Rules and the appellant clearing agent obtained delivery from Gerry's Shed and transported that to the appellant warehouse. After lapse of more than 02 months from the date of clearance the Assistant Collector of Customs, AFU, JIAP (here-in-after to be referred as respondent No.1) prepared contravention report on the pretext that M/s. Gerry's delivered a pouch containing documents of the goods imported arrived on the aircraft corresponding to IGM No. KPAF-9162 dated 21.09.2015 to his office, from which an invoice of US$. 32,124.00 is found as against declared and assessed. This lapse of non timely scrutinizing the pouch by respondent No. 1 was construed as a lapse on the part of appellant and was termed as an act of misdeclaration instrumental in causing loss to the exchequer to the extent of Rs. 1,017,362.00 attracting the provisions of Sections 32 and 32A of the Act and Section 11(3) of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001 and forwarded that to respondent No. 2 for issuance of show-cause notice by the authority competent to do so under Section 179 of the Act, The respondent No. 2 instead of forwarding that to the Additional Collector (here-in-after to be referred as respondent No.3) issued show-cause notice dated 15.12.2015 himself containing the fact and Section narrated/incorporated by the respondent No. 1 in the contravention report. The appellant consultant, replied to the allegation vide letter dated 25.03.2016 through which he challenged his powers under the provision of Section 179 of the Act and Section 11(3) of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001, in addition to controverting the charge of misdeclaration under the provision of sections 32 and 32A of the Act. The respondent No. 3 ignored the submission made therein and passed order-in-original dated 11.04.2016 through which we held the charges leveled in the show-cause notice established against the appellant and ordered to pay/deposit the evaded/short paid amount of duty and taxes of Rs. 1017362.00 along with default surcharge to be calculated at the time of payment failing to which recovery proceeding may be initiated against the appellant under Section 202 of the Act and Chapter IX (Recovery Rules) of the Rules. Additionally, a penalty of Rs. 500,000.00 was also imposed on the appellant and the clearing agent under Section 156(14) of the Act on the plea that it was mandated upon them under Section 192(1) of the Act to report the availability of invoice in the pouch delivered by Messrs Gerry's in the office of respondent No. 1.

3.The appellants filed the appeals on the basis of grounds enumerated therein. No cross-objection under subsection (4) of section 194A of the Act have been filed within the stipulated period of 30 days by the respondent No. 1 himself or through his subordinate, instead comments were filed by him, which are placed on record of the case for consideration and perusal.

4.Rival parties heard case record examined. Upon scrutinizing of the show-cause notice I have observed that the respondent No. 1 in para 2 inscribed the phrase "during the Post Clearance Audit, it was observed that the invoice of US$ attached with GD was suspicious a pouch of invoice delivered by Gerry's Shed to the office of Assistant Collector examination was scrutinized and the original invoice of the said consignment was found valuing to US$. 32,124.00". It is astounding that instead of inquiring from the Assistant Collector, Examination that as to why pouch delivered in his office by the Gerry's was not scrutinized and the invoice corresponding to the consignment under scrutiny was not delivered to the examining officials and taking him and the examining official to task that in the presence of availability of invoice in the office of Assistant Collector Examination, he failed to obtain that prior to examination and why he adduced remarks reading as "invoice not found", on the strength of which the Assistant Collector Examination issued show-cause notice to the appellant for the contravention of Rule 389 of the Rule and why he impose penalty of Rs. 5000.00 through a valid legal order-in-original, in the absence of which penalty cannot be imposed. The entire lapse in the light of the aforesaid observation lies either on the part of Assistant Collector of Customs, Examination or on the examining official and even on respondent No. 1 for causing loss to the exchequer due to negligent and wonton attitude, which cannot be condoned or ignored under any circumstances. The show-cause notice would had been issued to the negligent officials instead of appellant or his clearing agent. I am also at loss to observe that under which authority the respondent No. 1 did post clearance scrutiny falling under the provision of Section 26A of the Act. For post clearance scrutiny of the record of the importer the Federal Government inserted section 3DD in the Act, wherein Directorate of Post Clearance Audit was established and officials of which were delegated powers under different sections of the Act through S.R.O. 500(I)/2009 dated 13.06.2009. No power either post clearance scrutiny or audit of the imported consignment is available to any Clearance Collectorate in the presence of Directorate General of Post Clearance Audit. The respondent No. 1 while scrutinizing the Goods Declaration of the appellant infact conducted audit while usurping the powers of the Directorate General of Post Clearance Audit. Rendering his act suffer from jurisdiction and powers. Hence ab-initio, void and as such coram non judice as held by the Superior Judicial Fora in countless reported judgments relied upon the appellant namely Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer and Company v. Controller of Customs, (Valuation): (1992 ALD 449 (1) Karachi AAA Steel Mills Ltd., v. Collector of Sales Tax and Central Excise Collectorate of Sales Tax (2004 PTD 624), PLD 1976 Supreme Court 514 Ali Muhammad v. Hussain Buksh and others and PLD 2001 Supreme Court 514 Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others 2006 PTD 2237 Pak Suzuki Motors Company Ltd., Karachi v. Collector of Customs, Karachi, 2009 PTD (Trib) 1996 and 2010 PTD (Trib.) 832.

5.The expression of Section 179 of the Act is very clear in regards to determination of the powers of the adjudicating authority on the basis of "amount of duty and taxes involved excluding the conveyance." Not "amount of evaded duty and taxes". In this case the amount involved is Rs.1,142,980.00 (paid Rs. 125,618.00 for obtaining clearance on 08.10.2015 vide cash No. 214 + shown evaded amount of Rs. 1,017,365.00 in the show-cause notice. The competent authority to adjudicate the said case under clause (ii) of section 179(1) is Additional Collector of Customs. To the contrary, respondent No. 2 has issued the show-cause notice while usurping the powers of the Subordinate. This is not permitted under law. The plea advanced in the comments by the respondent No. 1 that due to non availability of Additional Collector, the respondent No. 2 assumed his powers and issued show-cause notice is without any substance and in derogation of the explicit provision of Section 179(1), for better appreciation verbatim of the same is reproduced here-in-under:--

179 Power of adjudication:---(1) Subject to subsection (2) in cases involving confiscation of goods or recovery of duty and other taxes not levied, short levied or erroneously refunded, imposition of penalty or any other contravention under this Act or the rules made there-under, the jurisdiction and powers of the officers of Customs in terms of amount of duties and other taxes involved, excluding the conveyance, shall be as follows, namely:-

(i)Collectorno limit

(ii)Additional Collector not exceeding three million rupees

(iii)Deputy Collector not exceeding one million rupees

(iv)Assistant Collector not exceeding five hundred thousand rupees

(v)Superintendent not exceeding fifty thousand rupees

(vi)Principal Appraiser not exceeding fifty thousand rupees.

[Provided that in cases of goods to be exported, the above officers of customs shall have their jurisdiction and powers in terms of FOB value and twice their respective monetary limit.]

(2) Notwithstanding the provisions of subsection (1), the Board may, by notification in the officials Gazette, fix or vary the jurisdiction and powers of any officer of Customs or a class of officers, and may also assigns or transfer {by an order} any case to any {officer} of customs, irrespective of the territorial jurisdiction. (emphasis supplied)

From conscientious study of section 179(1) of the Act, it is abundantly clear that the authority defined therein has to exercise powers, neither superior nor subordinate is empowered to assume the powers of his superior or subordinates, unless Board is desirous of fixing or varying the jurisdiction and powers of any Officer of Customs or a class of Officers, through a notification in official Gazette as per the expression of subsection (2) of section 179 assign or transfer any case to any Officer of Customs irrespective of designation or territorial jurisdiction. In the instant case no notification of the Board was/is presented under subsection (2) of Section 179 of the Act empowering respondent No. 2 for exercising powers of his subordinate. He assumed the powers of the Board himself in negation of subsection (2) of Section 179 ibid., which he could not assume under any pretext/ circumstances by virtue of the fact that while performing their duties as quasi judicial authorities they cannot be termed as subordinate to the higher officer and they are quite independent in performing their officials duties as adjudicating officers. This lapse render the order without lawful authority and jurisdiction. Hence, ab-initio, void and ab-initio wrong and the superstructure built there upon no matter how strong it may be has to crumble down. Meaning thereby order-in-original passed by the respondent No. 3 on the show-cause notice issued by the respondent No. 2 as well ab-initio void. The second illegality noticed by me in the instant case is that the respondent No. 3 passed order on the show-cause notice issued by respondent No. 2, which he could not do, unless respondent No. 2 withdraw the show-cause notice and respondent No. 3 issues a fresh show-cause notice under his signature. When the show-cause notice is issued by respondent No. 2 order has to be issued by him only, respondent No. 3 has no mandate to pass order on that. Respondents Nos. 2 and 3 simultaneously acted without lawful authority and jurisdiction by encroaching each other jurisdiction, which is ab-initio wrong and renders the show-cause notice and order-in-original without powers/jurisdiction. Hence, ab-initio void and coram non judice and as such of no legal effect.

6. The respondent No. 2 issued show-cause notice while incorporating therein Section 11(3) of the Sales Tax Act, 1990 and Section 148 without realizing that these are neither charging sections nor penal clauses, cognizance under Section 11(3) could only be taken by the Officer of Inland Revenue and Section 148 of the Income Tax Ordinance, 2001 contains the procedure for collection of Income Tax at import stage by the authorities referred therein. Meaning thereby that the said sections are independent under which no charge can be leveled. Therefore, no show-cause notice can be issued under these sections either by respondent No. 2 or order could be passed by respondent No. 3. Issuance of show-cause notice and passing of order-in-original on the basis of irrelevant sections, renders these ab-initio, void 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) 88 Taxation 128 (Lah), Union Playing Card Company v. Collector of Customs 2002 MLD 130, Atlas Tyres v. Addl. 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. Addl. Collector of Customs.

7.That it has also been contended by the Consultant/ Advocate of the appellant that Respondents Nos.2 and 3 have no mandate to issue show-cause notice or pass order-in-original in the matter of Sales Tax/Income Tax. Whereas, respondents are of the view that incorporation of the word "tax" in sections 32(2) and (3) and 179 of the Act and the clarification issued by the Board vide C.No.3(32)Tar-1/90 dated 06.08.2012 and legal opinion of Ministry of Law vide No. F.242/2012-Law.I dated 11.07.2012 is sufficient for assuming powers under the charging Sections of Section 11 of the Sales Tax Act, 1990 and 162(1) of Income Tax Ordinance, 2001. Upon perusal of section 32(2) and (3) of the Act, I have observed that although the word "tax" is available, this does not empowers the respondents Nos. 2 and 3 to assume powers under the provision of Section 11(2) & (3) of the Sales Tax Act, 1990 and 162(1) of the Income Tax Ordinance, 2001 unless Legislature appoint them as "Officer of Inland Revenue/Commissioner of Income Tax", who have powers under these Sections to take cognizance in the matter relating to Sales Tax and Income Tax, it is to be noted that the word "tax" therein is used for exercising jurisdiction under the said Section on the basis of involved amount of duty and taxes by the appropriate adjudicating authority defined in subsection (1). Therefore despite of insertion of the word taxes, the adjudicating authority including the Respondents Nos. 2 and 3 have to issue show-cause notice and pass order-in-original within the respective applicable provision of the Act and not under the charging provision of Section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001, which are otherwise non existence in the show-cause notice and charge against the appellant has been leveled under Sections 11(3) and 148 ibid, which are irrelevant. Even otherwise, the Respondents Nos. 2 and 3 have also relied upon clauses (14) and (14A) of Section 156(1) of the Act, applicable in the case of mis-declaration falling within the ambit of Section 32 of the Act. These clauses cannot invoked in the matter of Sales Tax and Income Tax falling under section 11 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001.

8.For further clarity of the issue I have scrupulously gone through the provision of Section 30 of the Sales Tax Act, 1990 and Section 207 of the Income Tax Ordinance, 2001 and observed that Respondents Nos. 2 and 3 have not been appointed as an Officer of Inland Revenue under these Sections. Resultant, they are not empowered to exercise the powers under Section 11 of the Sales Tax Act, 1990 and Section 162 (1) of the Income Tax Ordinance, 2001, which empowers Officer of Inland Revenue/Commissioner of Income Tax to initiate adjudication proceeding for recovery of short collected/paid Sales Tax/ Income Tax either due to collusion or connivance or inadvertent, error or misconstruction. Hence, Respondents Nos. 2 and 3 are not empowered to lay hands on any matter falling under the ambit of Section 11 of the Sales Tax Act, 1990 and Section 162 (1) of the Income Tax Ordinance, 2001. Reliance of Respondents on the clarification of the Board vide C.No.3(32)Tar-1/90 dated 06.08.2012 and opinion of the Ministry of Law vide No. O.M. No. F.242/2012-Law-I dated 11.07.2012 lend no help to the Respondent No. 1 as Board and Ministry of Law and Justice have no mandate to interpret the provision of the Act or amend the provision. It can only give opinion, it is for the judicial fora to interpret the provision of statute and our opinion stood validated from the reported judgment 2005 PTD 2462 Messrs Lever Brother Pakistan Ltd., v. Customs Sales Tax and Central Excise Appellate Tribunal, Karachi that "CBR has no place to in the Scheme of Law, conferred with the jurisdiction to interpret any law, statutory or in exercise of any deliberate authority i.e. subordinate legislation". Whereas in reported judgment 2016 PTD (Trib.) 107 Qazi CNG Station, Gujrat and another v. Directorate General of Intelligence and Investigation-FBR, Karachi and 2 others, this Tribunal held that "statute can be amended by the Parliament and a notification through a notification not through any communication. In the absence of amendment of notification, clarification issued by the department could only be termed as opinion and it would not at all amend the notification". Assuming powers on the strength of letter of the Ministry of Law and Justice is palpably illegal beside fatal to the health of the case. Even otherwise, the letter of the Ministry of Law and Justice speaks about collection of Federal Excise Duty at import stage in the same manner and at the same time, as if it is a duty of customs payable under the Customs Act, 1969 (IV of 1969) and for collection of the same the provision of Section 31A also apply. Reference of Section 7 of the Federal Excise Act, 2005 has also been given simply for clarification i.e. for collection of import duty provision of Sales Tax 1990 is applicable. The emphasis in the O.M. is levy and collection. Therefore, to further elaborate and settling the issue to its logical conclusion, I add while referring to Section 6 of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001 through which the Clearance Collectorates are empowered to collect the taxes on the imported goods as like custom duty. These sections least empowers the Officers of Customs including Respondents Nos. 2 and 3 to initiate adjudication/recovery proceeding for the short collected/paid, Sales Tax and Income Tax either due to collusion or connivance or inadvertent, error or misconstruction. For proceeding with 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, by the authority expressed therein i.e. Officer of Inland Revenue/Commissioner of Income Tax under subsections (3) and (4) of section 11 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001. In these sections neither Officer of Customs and Respondents Nos. 2 and 3 figures anywhere. They assumed the powers not vested with them under the provision of sections 11 and 162(1) of the Sales Tax Act, 1990 and Income Tax Ordinance, 2001. Confirming that the Customs Collectorates does have powers to collect, Sales Tax and Income Tax as duty at import stage, conversantly, to the plea that Customs is empowered to recover the short paid amount of sales tax and income tax at the import stage under Section 202 of the Act, is based on mistaken belief, infact the customs Collectorate could recover the amount of Sales Tax and Income Tax upon receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax in terms Section 48 of the Sales Tax Act, 1990 and Section 140 of the Income Tax Ordinance for recovery of the adjudged amount of Sales Tax and Income Tax after due process of law. Therefore, it is my considered opinion that the Clearance Collectorates 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 Act under Section 202 ibid., 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. and this stood validated from reported/unreported judgments listed below:

(i)2011 PTD (Trib.) 110 Messrs AGP (Pvt.). Ltd. v. Additional Collector of Customs, Karachi.

(ii)2010 PTD (Trib.) 2086 Messrs Global Marketing Services and another v. Model Customs Collectorate and another.

(iii)SCRA No. 01/2010 Collector of Customs, Islamabad v. Global Marketing Services and another v. Model Customs Collectorate and another.

(iv)2004 PTD 801 Al-Haaj Industrial Corporation (Pvt.) Ltd., Peshawar v. Collector of Customs (Appraisement).

(v)C.P. No. D-216/2013 Messrs Lucky Cement Ltd., v. Federation of Pakistan and others

(vi)2014 PTD 1963 Shujabad Agro Industry (Pvt.) Ltd. v. Collector of Customs and 8 others

(vii)2015 PTD 702 Muhammad Measum and others v. FOP and 2 others.

(viii) 2016 PTD (Trib.) 1008 Phillip Morris (Pakistan) Ltd, Karachi v. Additional Collector of Customs.

(ix)2016 PTD (Trib.) 2125 Al-Fajer Associates v. Directorate General of Intelligence and Investigations-FBR.

(x)Appeal No. K-1635/2014 Pepsi Cola Export Corporation, Karachi v. Directorate General of Post Clearance Audit and 2 others.

(xi)Appeal No.K-1029/2016 Messrs M.R. Sons, Karachi v. Directorate General of Intelligence and Investigations-FBR.

(xii)Appeal No.K-1030/2016 Messrs Muhammad Imran, Karachi v. Directorate General of Intelligence and Investigations-FBR.

(xiii) Appeal No. K-1343/2015 Messrs Rightway Trading Company, Karachi v. Deputy Collector of Customs, MCC of Appraisement-West and 3 others

The opinion formed by me also have the validation of the judgments reported at 1994 CLC 1612, 1990 PTD 29, 2005 PTD 23 and 2007 PTD 250 titled as Collector of Sales Tax and Federal Excise v. Messrs Qasim International Container Terminal Pakistan Ltd., wherein it has been held that "There is a clear distinction between the charging provision of Statute and the machinery part thereof. It is axiomatic that mode of manner of recovery does not alter, the nature of tax nor a tax can be introduced or import by implication." In 2008 PTD 1973 Xen Shahpur Division v. Collector of Sales Tax (Appeal), Collectorate of Customs, Federal Excise and Sales Tax, Faisalabad, for clarity of the Rule of Interpretation of Statute, golden principle was outlined in so many words reading as "That fiscal law is to be applied with full authority and its natural meaning-one has to look merely at what is clearly said and there is no room for any intendment-neither there is equity about a tax nor presumptions as to tax - nothing is to be read in, nothing is to be implied -- one can only look fairly at the language used" The Hon'ble Supreme Court of Pakistan in reported judgment 2006 SCMR 12 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 in the light of the law laid down in the referred in above and cases reported at that the exercise of jurisdiction on this point by Respondents Nos. 2 and 3 are without lawful authority and jurisdiction. Hence, issuance of show-cause notice and passing of Order-in-Original are ab-initio void and as such coram non judice.

9.That in the presence of admitted fact by the respondent No. 1 that the carrier after discharge of goods, delivered the pouch of the corresponding documents of the import arrived on the carrier to the office of Assistant Collector of Examination, in which the impugned invoice was also available lapse rest on the part of Assistant Collector of Examination of not opening the pouch for delivering the invoice of the consignment under scrutiny and remaining arrived consignment to the examining officials. If that would had been done promptly and diligently, such ignoble situation would not had been emerged and the examining official would had inscribed in the examination report "invoice found" for US$. 32,124.00 as against clear inscription "invoice not found" on the strength of which the competent adjudicating authority defined in Section 2(a) passed assessment order under Section 80 and Rule 438 of the Act/Rules in exercise of the powers vested upon him through S.R.O. 371(I)/2002 dated 15.06.2002. In the presence of these vital apparent/ admitted fact deliberate act or connivance of the appellant either with the clearing agent or Customs Officials of examination/processing is not visible. Resultant, invoking of Section 32(2) or 32A of the Act is out of context. Hence, the case in question at the most could be termed as " inadvertence, error, omission and mis-construction" falling under the ambit of Section 32(3) of the Act, the appropriate authority to issue show-cause notice and pass order order-in-original rest with the Principal Appraiser in terms of Serial No. 3(ii) of S.R.O. 371(I)/2002 dated 15.06.2002. To the contrary, in the instant case show-cause notice/ order-in-original were issued/passed by respondents Nos. 2 and 3 respectively, while encroaching the explicit notified powers of Principal Appraiser which is not permitted in the absence of availability of notification issued by the Board in terms of subsection (2) of Section 179 of the Act or amending S.R.O. of the existing and infield S.R.O. 371(I)/2002 dated 15.06.2002. It is settled principle of law that no superior authority is allowed to usurp the powers of his subordinates as held by the Hon'ble Supreme Court of Pakistan in reported judgment PLD 1973 Supreme Court 49 The State v. Zia-ur-Rehman and others and 2009 PTD 1083 that "Superior authority cannot exercise the power of his subordinates for adjudication purpose ..powers of sub-ordinate exercised by superior authority is held as without jurisdiction beside usurpation". Rendering the act of issuance of show-cause notice and passing of order-in-original in the instant case without power/ jurisdiction, hence, ab-initio, null and void and coram non judice. It is also settled principle that the exercise of jurisdiction by an authority is mandatory requirement and its non fulfillment would entail the entire proceeding to be coram non judice. Ref: PLD 1963 SC 663, PLD 1971 SC 184, PLD 1976 Supreme Court 514, 1983 SCMR 1232, 1984 CLC 1517, PLD 1995 Kar. 587, PLD 1992 SC 486, 2001 SCMR 103, 2004 CLD 373, PLD 2004 Supreme Court 600, PLD 2005 Supreme Court (sic), PLD 2005 Supreme Court 842, 2009 PTD (Trib.) 1996, [(2009) 100 Tax 24 (H.C. Lah.)], 2010 PTD (Trib.) 832, 2010 PTD 465, 2010 PTD (Trib.) 1636, 2011 PTD (Trib.) 2114, 2011 PTD (Trib.) 2557 and 2014 Supreme Court 514.

10.That while passing order-in-original, it is mandated upon the adjudicating authority to examine the charter of show-cause notice and remain within its ambit. In case order so passed is beyond the charter of the show-cause notice, it is deems to be illegal and the Appellate Authority is left with no other option except to declare it suffering from legal infirmity and as such void. While examining order passed by Respondent No. 3, I have noted that he made a reference in para 4 reading as "the respondents were asked to show any communication/ correspondence which must have taken place between him and the supplier regarding the value of the goods before the arrival of the consignment so that the correct/actual value could be ascertained. However, no such correspondence was provided" has been made, despite of the fact that these narration/grounds are not available in the show-cause notice. This confirms that order has been passed beyond the charter of show-cause notice. Such type of the orders are always declared by the Superior Judicial Fora in reported judgments namely Collector Excise and Land Customs and others v. Rehm Din reported at 1987 SCMR 1840 and Adam v. Collector of Customs, Karachi PLD 1969 Supreme Court 446, Muhammad Sadqain v. Collector of Customs (Appraisement) 2006 PTD 2742 and Messrs Exide Pakistan Ltd., v. Deputy Collector of Customs (Adjudication-III), Karachi, 2004 PTD 1449, wherein it has been held that "Order of adjudication, being ultimately based on a ground which was mentioned in the show-cause notice is palpably illegal on the face of it".

11.Notwithstanding, now it is well settled law that upon passing of assessment order under Section 80 and Rule 438 of the Act/Rules and thereafter passing of clearance order under Section 83 and Rule 442 ibid by the authority defined in Section 2(a) of the Act and Notification No. 371(I)/2001 dated 15.06.2001, it cannot be disturbed by any authority including respondents for preparing contravention report for adjudication proceeding, which respondent No. 1 did on the strength of which respondent No. 2 issued show-cause notice and respondent No. 3 passed order-in-original. The only course available under law for the respondent No. 1 was to challenge the assessment order dated 07.10.2015 before the Collector of Customs (Appeals) under section 193 of the Act in exercise of the powers delegated upon them. In the filed appeal the respondent No. 1 is empowered to incorporate all the apprehension, misreading of the facts and contravention of the provision of the Act/Rules. The Collector of Customs, upon receipt of the appeal and going through the facts and grounds if thinks fit that the contention of the respondent No. 1 seems to be correct and the duty and taxes has not been either not levied or short paid on the basis of the goods found subsequent to clearance, is empowered to issue show-cause notice to the importer (appellant) as expressed in 3rd proviso to the subsection (3) of Section 193A of the Act. Instead of the adhering the prescribed method available in the Act the respondents reopened the assessment/clearance order under section 195 of the Act under which no powers are vested either of them. When the right of appeal has been accorded to the officer of Customs by the legislature in the provision of Section 193 of the Act, the provision of Section 195 is un-operational and cannot be exercised even by the authority defined therein and this has been validated by the Hon'ble High Court of Sindh in reported judgment 2014 PTD 1256 Messrs Paramount International (Pvt.) Ltd., Karachi v. Secretary Revenue Division that " department or an Officer of Customs, if aggrieved, by any decision or order passed by an officer of customs below the rank of additional collector could prefer an appeal before the Collector (Appeal)---1st order-in-original passed in the subject matter was an appealable order for both the parties, therefore option to reopen and order pass under the adjudication hierarchy was not available to the Collector. Even the Collector of Customs Adjudication could not oversee or exercise any right of re-opening of any order which has been passed by an officer lower in rank but acting as an adjudicating authority. Impugned order was set-aside and Constitution Petition was allowed."

12. It is also settled proposition of law that in the presence of an appealable order, fresh order cannot be passed even in the shape of reassessment order or through issuance of show-cause notice under section 180, while exercising powers under the provision of Section 179 ibid. These act is piling upon multiple orders on the existing appealable order not permitted under law as held by Hon'ble High Court of Sindh in reported judgment 2004 PTD 3020 Messrs Smith Kline French v. Pakistan that "once an order is passed, which attain finality the same cannot be subject to a show-cause notice again, considering that no appeal or revision is filed against the first order". By virtue of non filing of appeal against the assessment order dated 07.10.2015 as elaborated above by the respondent No. 1 on or before 14.11.2015 . The transaction stood past and closed and attain finality and cannot be disturbed. For reaching at the decision we have gained strength from the reported judgment 1989 MLD 4310 Messrs World Trade Corporation v. Central Board of Revenue, wherein their lordship of High Court held that "if the order has attained finality through limitation. A fortiori; the Central Board of Revenue could not open up an order that has attained finality, under the Sea Customs Act, 1878 and against which suo motu revision." Beside, the act of issuance of show-cause notice and passing of order-in-original by respondent No. 3 falls under the ambit of "double jeopardy" not permitted under Article 13 of the Constitution of Islamic Republic of Pakistan. Rendering the order dated 11.04.2016 passed by respondent No. 3 for piling upon an existing appealable order is without lawful authority and jurisdiction and as such void and ab-initio and of no legal effect.

13.I have also observed with great concern that the order passed by respondent No. 3 is in derogation of the provision of the Act/Rules as it is not a speaking order and least conform to the mandated requirement of section 24-A of the General Clauses Act, 1897 and this stood validated from the fact that the appellant in grounds Nos. (a) to (d) of the reply to the show-cause notice dated 25.03.2016 challenged the jurisdiction of respondent No. 2 and even his, in addition to other illegalities apparently floating on the surface of show-cause notice, which he completely ignored despite of the fact that it is settled proposition of law that the question of jurisdiction has to be decided first prior to proceeding in the merit of the case. Non deciding the question of jurisdiction is tantamount to admission, which he intentionally left undecided being correct and within the mandate of law. He intentionally, opted to take up the case for decision on his personal pre-determined opinion, despite nullity to the fact and law and that also without rebutting a single ground advanced by the appellant consultant in the reply. For this type of order the Division Bench of the Hon'ble High Court of Sindh held in reported judgment 2002 CLC 825. Wherein, the Hon'ble Division Bench of the High Court held that:

"Failure to give decision on each issue---Trial Court while deciding the suit had framed six issues but did not extend reasons separately on all issues and decreed the suit.---while deciding appeal the Appellate Court had also not decided the suit---while deciding appeal the Appellate Court had also not deciding the appeal issue-wise. Both the Courts below had disregarded mandatory provision of O.XX, R 5 C.P.C. and O.XLI, Rule 31, C.P.C. respectively. Where in the judgment the Appellate Court had not stated points for determination, decision thereon and the reasons for its findings, the same was not a "judgment" according to law---- Trial Court and Appellate Court having acted in exercise of its jurisdiction with material irregularity". The Division Bench also held that "Good judgment must be self evident and self explanatory---In other words it must contain reasons which should justify conclusion arrived at and the reasons should be such that a disinterested readers can find same convincing or at least reasonable".

As aforesaid, it is my considered opinion that such type of orders are deem to be illegal, void, arbitrary and are 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 as of the instant case, i.e. without any exception illegal arbitrary 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 order is without any ambiguity is in violation of basic principle of the good governance and mandatory requirement of Section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law, further stood fortified from 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, PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173, 1984 SCMR 1014, 2012 PTD (Trib.) 619 and 2016 PTD 589.

14.What have been discussed here in above, particularly the interpretation of law, legal propositions and observations made thereon and to follow the ratio decidendi. I hereby vacate the impugned show-cause notice and set aside the order passed by the forum below being illegal, void and ab-initio to the extent of appellant. The appeal is accordingly allowed.

15.Orders passed accordingly with no order as to cost.

HBT/36/Tax(Trib.) Appeal allowed.