2013 PLP 433 (PTD)

5. The complainant was supplied a copy of para-wise comments but he did not opt to file a rejoinder.

6. The parties were afforded opportunity of hearing on 4-12-2012.

7. During hearing, the AR, reiterating averments of the complaint, submitted that the Department was responsible for safe custody of the pay order. In case of wrongful encashment of pay order the Department was bound to compensate the complainant for loss.

8. The DR supporting the averment of para-wise comments submitted that the cheque was not encashed by the Department and the matter was sub judice in the Court of Special Judge.

9. On query the DR informed that departmental inquiry was conducted against LDC and Appraising Officer (Incharge of Security Section). They were suspended. However, subsequently they were reinstated. The inquiry had not yet been finalized. The DR submitted that no court of law had been approached for recovery of amount of the pay order illegally encashed.

10. The DR was confronted with letter dated 22-12-2008 issued by Mr. Haroon Ahmed to the I.O. with the undertaking that he did not intend to claim the amount from Messrs Ali Shan Enterprises. However, he could not support the objection raised about locus standi of the complainant to claim the amount of pay order.

11. The AR on being confronted with the issue of limitation submitted that applications were repeatedly made to the Department, and when no response was received, the complaint was filed before the Hon'ble Federal Tax Ombudsman.

12. Submissions of the parties have been considered in the light of averments of their pleadings and documents available on record. Before going into the merits, the legal objections about maintainability of the complaint need to be addressed.

13. It is an admitted fact that the matter relates to the year 2008 and the complaint has been filed on 18-10-2012. Therefore its maintainability was subject to special circumstances which could be deemed proper in the interest of justice to entertain the complaint by condoning the delay under section 10(3) of the FTO Ordinance. The theft of the pay order from the custody of Customs; its encashment by another person; and inaction, delay and negligence of the Department are certainly special circumstances justifying entertaining of the complaint in the interest of justice. The delay is therefore condoned.

14. The Department's objection about matter being sub judice before the Special Judge on the face of it is found to be without any substance as no matter about claim of the complainant for release/refund of pay order is sub judice before any court, forum or authority, hence the objection is overruled.

15. The admitted feature of the case is that the subject pay order was submitted by the complainant and it was accepted by the Department without any objection. In such view of the matter, the issuance of the pay order on the request of Mr. Haroon Ahmed from his account had no relevance. The letter dated 22-12-2008 of Mr. Haroon Ahmed being relied upon by the Department does not demolish the locus standi of the complainant. Mr. Haroon Ahmed has made it crystal clear that all rights regarding the pay order were of the complainant. The Department has misquoted the letter. The DR on being confronted with the letter could not support the objection of the Department about locus standi of the complainant to claim release/refund of the pay order. The objection being without substance is rejected.

16. Adverting to the merits of the case, it is observed that the goods of the complainant were released provisionally under section 81 of the Customs Act on payment of duty and taxes on declared value. The differential amount was secured through pay order of Rs.2,373,392 which was required to be released on final determination of value and payment of due amount of duty and taxes. Despite payment of duty and taxes as per final assessment, the security / pay order was not released as it was allegedly stolen from the custody of the Department and encashed with the connivance of the relevant officials of the Department. The pay order was in the name of Collector MCC and it could have been credited only to the official/Government account. Registration of F.I.R. against theft of the pay order and a departmental inquiry were not enough. In any case, the officials alleged to be involved in the theft, after being suspended for a short term, have been reinstated. No action has been taken for the recovery of the amount of pay order illegally encashed.

17. The complainant was entitled to the release of pay order, after payment of due duty and taxes. The Department was under legal obligation to return the pay order or refund the amount. The complainant could not be deprived of his legitimate money for the fault of the Department. The inaction, delay, inefficiency and ineptitude in discharge of duties and responsibilities on the part of the Department are apparent on the face of record and are tantamount to maladministration under section 2(3) of the FTO Ordinance. Findings:

18. Maladministration of the Department is established. Recommendations:

19. FBR to direct the Collector MCC to- (i) finalize the departmental inquiry without further delay; (ii) take steps, as per law, for the recovery of the defalcated amount; (iii) refund the amount of pay order to the complainant; and (iv) report compliance within 30 days. CMA/202/FTO Order accordingly.