2003 PLP 2665 (PTD)

2. The Advisor stated that 184 days after the filing of the refund claim, and 128 days after his reminder, the claim was rejected vide Order‑in‑Original, dated 11‑3‑2003 on the grounds that the complainant's name was sot mentioned in the list of appellants in the judgment of the Supreme Court and .the certificate from the Chartered Accountant had not been produced. He argued that the judgment of the Supreme Court had struck down section 18‑B from the Customs Act because it was held as unconstitutional, illegal and ultra vires of the Constitution. Therefore, the money collected against this section automatically became refundable. The argument that the name of the complainant was not included in the list seemed to be a calculated and mischievous effort to deprive him of his money which was illegally collected. He termed it as, a crude attempt against the spirit of the Supreme Court‑judgment. He asserted that the Assistant Collector himself had sanctioned hundreds of claims for the refund of PSI charges of such claimants whose name were not mentioned in the list of the appellants.

3. The Advisor invited, reference to the advice of the Law and Justice Division which clearly stated that all importers who had paid the service charges were eligible for refund. It did not specifically mention that the refund would be made only on the submission of a certificate, from a Chartered Accountant that the incidence of the service charges had not been passed on to the consumer. The judgment too had not prescribed any such condition and prescribing such a condition by the Department was, a case, of clear defiance and called for action for contempt of the Court.

4. The Advisor stated that the Sindh High Court had taken a very serious note of the letter sent by Joint Secretary of the Law and Justice Division and has passed an order that the said circular was violative of the order of the Supreme Court and it should, not be acted upon. He asserted that there was no law whereby the certificate of a Chartered Accountant could be termed as a mandatory, requirement, the Supreme Court. has prescribed no such condition and the circular of the Law and Justice Division has been set aside by the High Court.

5. The Advisor stated that the respondent had resorted to an illegal and unconstitutional method of depriving the petitioner of his legitimate dues, and requested that the Department be directed to refrain from such an approach, pay the claimed amount and stop harassing genuine claimants through such actions.

6. The Assistant Collector of Customs (Appraisement), Group‑V, replied to the complaint that, in the light of advice of the Law and Justice Division, dated 14‑1‑2001, it. was essential of the Department to ensure that 2% PSI charges, had not been passed on to the consumer and, therefore, a certificate from the Chartered Accountant was demanded. The complainant failed to provide the certificate. He referred to the observation of this office in the Findings/Decision of Complaint No.703‑L/2001 that the Department had asked the complainant's to rove through accounts books that the additional amount of 2%, was not reflected in the sale price or produce a certificate from the Chartered Accountant to this effect since the complainant had failed to provide necessary evidence, the claim for refund could not be accepted and the complaint was not justified and, therefore, dismissed.

7. The Assistant Collector stated that the refund claim filed, in this case has already been rejected and necessary order has been issued. The complainant has not exhausted the legal remedies. The complaint was, therefore, not maintainable and be dismissed. He stated that the requirement of Chartered Accountant's certificate was only a measure of simplifying the procedure to determine that the incidence had not been passed on to the consumer. The High Court's judgment in Suit No. 1597 of 1999 had not been provided to him and no comments could be offered about it. The clarification of Law and Justice Division was in the line with the decision of the Supreme Court in case of Army Welfare Sugar Mills Limited and Pfizer Laboratory and the aforesaid advice clearly provided that refund could not be allowed where incidence has been passed on to the consumer.

8. During the hearing of the complaint, Mr. S.M. Younus, Advisor, reiterated that the requirement of the Chartered Accountant's certificate was not laid down in the judgment, of the Supreme Court or the instructions of the Law and Justice Division. On the other hand, the High Court, vide judgment, dated 3‑9‑2001 in Suit No. 1597'of 1999 has held that C.B.R.'s circular in regard to the refund of service charges was vioiative of the order of the Supreme Court and the notification (circular) should not be acted upon. The Customs Authorities are bound by the order of the High Court. The Assistant Collector maintained that the (rejection) order passed by\him was in consonance with the directive of the Law and. Justice Division communicated to the Department through the C.B.R.

9. The learned Advisor has rightly argued that it would not be possible for the complainants to pay for the Chartered Accountant's certificate for the refund of a small amount‑of Rs.8,

246. Additionally, and more importantly, the Sindh High Court in Suit No.1597 of 1999. has clearly ordered that circular of the C.B.R. in regard to the service charges was violative of the order of the Supreme Court, an attempt to disobey the said order, and it would not be acted upon.

10. It is recommended that C.B.R.:‑‑‑ (i) set aside the Order‑in‑Original, dated 11‑3‑2003 passed by the Assistant Collector of Customs, Group‑V, against Messrs Mehran Agency (ii) direct the Collector of Customs to sanction the refund of service charges amounting to Rs.8,246 and pay the same within thirty days/and (iii) Compliance be reported within forty‑five days. C.M.A./884/FTO Order accordingly.