2004 PLP 161 (PTD)

3. They requested that the Collector be directed to refund the amount which they had forcibly recovered without giving opportunity to file an appeal with the Tribunal and wait for its result. The Customs Authorities be ordered to pay back the refund alongwith the mark-up of 14% and the cost of litigation amounting to Rs.300,000.

4. The Assistant Collector of Customs replied to the complaint and raised the objection that the appeal in the instant case was pending in the High Court against the Appellate Tribunal's order dated 11-7-2002 and under section 9(2) of the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2000, the sub judice matters were excluded from the jurisdiction of this office. The Assistant Collector further stated that the Appellate Tribunal's order was passed on 22-7--2002 and the complaint before the Federal Tax Ombudsman has been filed on 17-1-2003, which was also barred by time.

5. The Assistant Collector stated that the Department had filed appeals before the High Court of Sindh on 19-9-2002; and since the matter was sub judice and the decision of the Court was awaited, there was no question of maladministration. He requested that the complaint be dismissed "for misrepresenting the facts and crudely and unlawfully attempting to influence the path of adjudication proceedings despite the fact that the complainant is well aware that the matter is sub judice before the Honourable High Court of Sindh at Karachi".

6. Mr. Muhammad Iqbal, Manager, Imports stated during the personal hearing that the Department did not mention in its reply to the complaint that they had again gone in appeal to the High Court on 19-9-2002. Since July, 2002, he has been approaching the Customs Authorities for refund of the amount in pursuance of the Tribunal's decision but no reason has been given for not acceding to their request and no intimation given that the Department has again filed an appeal before the High Court. The second appeal has not been taken up even for preliminary hearing. When the Department adjudicated the cases against them, they made immediate recovery and did not wait for Tribunal's decision. Now the matter has been decided by the Tribunal twice but the Department was taking a different view and not allowing refund. They were willing to provide any undertaking or guarantee that they would abide by the final decision of the superior Court but, meanwhile, the Department should grant them the refund of the amount.

7. The Deputy Collector of Customs replied that besides the appeal the Department has also filed application before the High Court and for stay of refund. There were a large number of similar cases in respect of other exporters and it would not be practically feasible for the Department to allow refund against undertaking/guarantee to a particular exporter. If the request of the complainants were allowed, it would weaken the case of the Department and would adversely affect the revenue amounting to several millions rupees relating to large number of exporters. He admitted that the Department's appeal has not yet been presented even for Katcha Peshi and not admitted for hearing.

8. From the foregoing arguments it is clear that the Tribunal decided the matter twice in favour of the complainants, but the Customs Department did not refund the amount of sales tax on the plea that the matter was sub judice before the Sindh High Court. The issue in this complaint and before the High Court is the same. In these circumstances no interference can be made.

9. It has been noticed in many cases that the Department take the plea that appeal has been filed in the High Court or other forum but no particulars are provided nor they seem to be aware of the present status of the pending proceedings.

10. It is therefore, recommended that: -- (i) C.B.R. to issue order that:

(a) Where the Department takes the plea that it has filed any appeal or proceeding which is pending it must give full particulars alongwith the copy of the appeal/petition. (b) After filing appeal or petition before Tribunal, High Court or Supreme Court -the Department should serve a notice intimating the assessee about the filing of appeal/petition. (ii) Compliance be reported within 30 days. C.M.A./870/FTO Order accordingly.