2020 PLP (Trib (PTD)

SYED TANVIR AHMAD (MEMBER TECHNICAL-III).

This Judgment disposes off Appeal No. K-1056/2018 filed by the appellant against Order-in-Appeal No. 454/2017 dated 15.08.2017 passed by the learned Collector of Customs (Appeals), Karachi.

2. Briefly facts of the lis are, the appellant is an online mega store alike Daraz.Pk and sell goods that are freely available in the local market. The ordered goods are supplied to their buyers from their warehouse, where the goods are kept after procuring. That the officials Anti-smuggling Unit of Directorate General of Intelligence and Investigations-FBR, Karachi (respondent No.1) raided the Office / warehouse of appellant and desired to conduct search the premises, which was agitated upon as no illegal activity was carried out by the appellant. The subordinate of the respondent No. 1 made appellant and his staff hostage and thereafter conducted the search, despite of the fact that all the items listed in the show-cause notice were lying openly in the office/warehouse. They took the possession of those namely (i) 35 Laptops/Tablets (Refurbished) (ii) 145 Smart Watches (New) of different brands (iii) 33 Branded Mobile Phones (Refurbished) (iv) 5 Branded New Phones (v) 4 Sports Music Watches (New) and (vi) 35 Laptop Bags (New) of different brands and origins comprehensive details in regards to model and quantity is detailed in inventory dated 16.06.2016 available at page 50 to 55 as Exhibit "E" of memo of appeal and directed appellant to substantiate the lawful possession/display of the items/goods, respective invoices/bills were supplied, the subordinate of respondent No.1, despite finding those answering to the description of the possessed goods/items refused to accept those as valid on one pretext and another and seized those under the provision of Section 168(1) of the Customs Act, 1969 (Act). On the strength of which subsequently framed contravention report and forwarded that to the Collector of Customs (Adjudication-I), who marked it to respondent No. 2, being the competent authority to proceed with the matter under the provision of Section 179 of the Act, who issued show-cause notice dated 09.08.2016, alleging that the appellant is involved in the act of smuggling in addition to in possession of smuggled goods as defined in Section 2(s) of the Act, hence, contravened the provision of Sections 2(s) and 16 of the Act, punishable under clauses (8) and (89) of subsection (1) read with subsection (2) of Section 156 of the Act. The appellant consultant submitted reply to the show-cause notice through which he challenged the powers/jurisdiction of respondent No. 1 of conducting search, and thereafter seizing the goods, otherwise available freely in the market and requested her to vacate the show-cause notice and order restoring of the goods to the appellant. However, the respondent No.2 passed ordered dated 05.12.2016 through which mobile phones were ordered to be confiscated and redeeming of the remaining items/goods upon payment of imposed 20% /penalty of Rs.75,000.00 in addition to leviable duty and taxes on the value determined by the subordinate of respondent No.1. Paras 5 and 6, which read as: "5- I have examined the case record and heard arguments of both the sides. The consultant of the respondent has mainly relied that the official of DG I&I-FBR were not empowered to search the premises of the warehouse in exercise of the powers vested under the provision of 163 of the Customs Act, 1969. The seizing officer personally visited number of time to the showroom/shops who has issued purported invoices for verification but no response was received from any of the purported seller of the impugned goods. Accordingly, the proof of purchase from local market is not established as laid down by the Supreme Court of Pakistan in the referred cases, there is no doubt that the imported goods that are not ban and freely available in the local market can be freely move from one place to another on the presumption that the leviable duty/taxes have been paid. However, when there is specific translation or reasonable belief contrary to this presumption specially regarding notified goods (Notification No. 566(I)/2005 dated 06.06.2005). Section 156(2) is attracted and the concerned /prosecution are duty bound to check the veracity of any such information/reasonable belief etc. Section 156(2) of the Customs Act, 1969 clearly states that if goods notified for the purpose of Section 2(s) of the Customs Act, 1969 are seized on a reasonable belief that an act to defraud the Government of any duty payable thereon has been committed the burden of proving that no such act has been committed shall be on the person from whose possession the goods were seized, section 156(1), (89), (1) of the Customs Act, 1969 constitute it to be an offence. The sections reads "if any person without lawful excuse, the proof of which shall be on such person, acquires possession of or in any way concerned in carrying, removing depositing harboring , keeping or concealing , or in any manner dealing with the smuggled goods or any goods in respect to which there may be reasonable suspicion that they are smuggled goods". Hence, the presumption of law import of goads has been rightly questioned by the seizing agency/prosecution. It is also clearly contrary to the presumption of lawful import as neither the GD nor the local Sales Tax invoice provided by the advocate of the respondent has been found to be relevant to the seized goods. 6- In view of the foregoing deliberation and legal proposition of law, the charges leveled in the Show-Cause Notice stand established and the respondents have not been able to discharge burden of proof as per section 156(2) of the Customs Act, 1969. Hence, section 2(s) of the Customs Act, 1969 stands established. Accordingly, I therefore, order confiscation of the seized foreign origin goods under clauses (89) (90) of Section 156(1) ibid of the Customs Act, 1969. However, an option is given to the owner /claimant of the goods except foreign origin mobile Phones under section 181 of the Customs Act, 1969 read with SRO 499(I)/2009 dated 13.06.2009 to redeem the seized foreign laptop and smart watches on payment of duty and taxes leviable on the goods as well as fine equivalent to 20% of the value of the offending goods. A penalty of Rs. 75,000/- (Seventy Five Thousand only) is also imposed upon the claimant /owner of the goods . the goods may be handed over to the right full owner after payment of duty and taxes, redemption fine etc., however, the foreign origin Mobile Phone are confiscated outright."

3. The appellants challenged the vires of the order before the respondent No. 3, who rejected that and maintain the order passed by respondent No. 2 vide order dated 15.08.2017. Para 5 of which is relevant and as such verbatim of which is reproduced here-in-under: "I have gone through the record of the case and the verbal/written arguments of the appellant counsel and Respondents. The impugned goods of the appellants appear to have been smuggled in to the country which were purchased by the appellant from the local market. No documentary proof of payment of duty and taxes have been brought forth despite considerable time afforded to the appellant since the time of seizure. The burden of proof has not been discharged by the appellant to prove the goods are non smuggled. Therefore, despite my sympathy for the appellant who purchased the goods in good faith from the local market considering these to be duty paid, I am constrained to disallow the appeal and uphold the Order-in-Original."

4. The Appellant has now challenged the vires of the order through appeal for decision of the Appellate Tribunal on the strength of the grounds taken therein. No cross objection under subsection (4) of section 194A of the Act were filed within the stipulated period of 30 days by the respondent No. 1 instead comments, which do not in any manner qualify as memo. of cross-objection, were submitted to be termed as cross appeal as per the contemplation of subsection (3) as expressed in aforesaid section. These could be considered merely an opinion, having no binding force, are placed on record of the case for perusal and consideration.

5. Heard and case record perused and so the relied upon judgments, this appeal could be decided on a short point of limitation among others, which shall be deliberated after the said point of law. Appeal before respondent No.3 was filed by the appellant on 29.12.2016, in terms of subsection (3) of Section 193A of the Act, Order has to be passed within 120 days i.e. on or before 28.04.2017 or within further extended period of 60 days in terms of its proviso by the Board, upon availability of exceptional circumstances and recording of those after issuance of notice to the subject as held by Hon'ble Supreme Court of Pakistan in reported judgment 2009 SCMR 1881, Khalid Mahmood v. Collector of Customs. In the instant Order has been passed on 12.08.2017 after the expiry of initial period of 120 days, without any extension as evident from the order which is silent. This vital illegality render the order passed by respondent No. 3 barred by time by 109 days. Rendering it without power/jurisdiction, hence void, ab-initio and not enforceable under law as held in the reported judgments 2017 PTD 1756 and 2017 SCMR 1427 Collector of Customs Sales Tax Gujranwala and others v. Super Asia Mohammad Deen and Sons and others, 2008 PTD 60 Messrs Super Asia Muhammad Din Sons (Pvt.) Ltd. v. Collector of Sales Tax Gujranwala and 2008 PTD 578 Messrs Hanif Strawboard Factory v. Additional Collector (Adjudication) Customs, Sales Tax and Central Excise Gujranwala, 2009 PTD 762 Messrs Tanveer Weaving Mills v. Deputy Collector Sales Tax and 4 others 2009 PTD (Trib.) 1263, Messrs Syed Bhai Lighting Limited, Lahore v. Collector of Sales Tax and Federal Excise, Lahore and 2 others 2009 PTD 1978; Leo Enterprises v. President of Pakistan and others 2010 PTD (Trib.) 1010 Innovative Impex v. Collector of Customs, Sales Tax and Federal Excise (Appeal), 2011 PTD (Trib.) 79, Fazal Ellahi v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib.) 987 Unique Wire Industries v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib.) 1146 Kaka Traders v. Additional Collector of Post Clearance Audit and 2012 PTD (Trib.) 1650 Pak Electron Ltd. v. Collector of Customs, Lahore and others.

6. The appellants are of the view that Orders are without jurisdiction and as such void ab-initio. Indeed the respondent No.1 and his subordinates are appointed and designated as "Officer of Customs" under Section 3A of the Act and they derive powers for functioning under the section incorporated in column 3 of SRO 486(I)/2007 dated 09.06.2007 within the territory of Pakistan for thwarting the act of smuggling but this doesn't means that they have unfettered powers to approach any office/warehouse situated either within the city or country for inspection of the displayed/warehoused goods. The appellants contended that their jurisdiction in principal is restricted to the territory not falling beyond the ambit of Customs Ports/Airport etc. and landing places and limits of custom station as expressed in Sections 9 and 10 of the Act and within 5 kilometer of the borders of India and Iran as contemplated in Section 177 of the Act and SRO No. 118(I)/83 dated 02.02.1983. The premises/warehouse of the appellant situated in the posh locality of the city not beyond the places other than defined in sections 9 and 10 of the Act or within 5 kilometers of India and Iran Border as per the enunciation of section 177 of the Act and SRO 118(I)/83 dated 02.02.1983, resultant, goods/item displayed therein are not subject to scrutiny i.e. their imports/purchased a defined in section 2(s) of the Act. Now the question arise that as to whether respondent No.1 and his subordinates were/are empowered to conduct search of the company , who is pioneer in the IT business and known of repute when introducing the companies of Pakistan dealing in IT, he is one of those , who started online mega store, the well known "Daraz" started. business subsequently and much later, directly under the provision of Section 163 without recourse to 162 of the Act. The respondent No. 1 subordinates conducted search under section 163 of the Act of the premises of appellant situated at House No. 2, 43/1/Q, Razi Road, Block-6, PECHS, Karachi, where appellant display/warehouse goods/item meant for sale online. The appellants, argued that every search under Section 163 of the Act has to be made by the officer concerned strictly in accordance with the spirit of its expression after exhausting recourse of obtaining a search warrant in terms of Section 162 ibid from the Judicial Magistrate on the basis of an application by Gazetted Officer of the Customs, stating the grounds of his belief that the good liable to be confiscation or documents or things, which in his opinion shall be useful as evidence in proceeding under the act and those are hidden in some secret place where search has to be made after having knowledge of the place which was earlier a guarded secret and the Judicial Magistrate after going though the request if felt appropriate issues search warrant, which has to be executed in the same way and have the same effect as of search warrant issued under the CCP 1898. It is beneficial to reproduce Sections 162 and 163 of the Act: 162 : Power to issue search warrant:- (1) Any Judicial Magistrate may, on application by a Gazetted Officer of Customs stating the ground of his belief that goods liable to confiscation or documents or things, which in his opinion will be useful as evidence in any proceeding under this Act are secreted in any place within the local limits of the jurisdiction of such magistrate, issue a warrant to search for such goods documents or things. (2) Search warrant shall be executed in same way, and shall have the same effect as the search warrant issued under the Code of Criminal Procedure, 1898 (Act V of 1898)

163. Power to search and arrest without warrant:- (1) whenever any office of Customs not below the rank of an Assistant Collector of Customs, or any other officer of like rank duly employed for the prevention of smuggling having reasonable grounds for believing that any goods liable to confiscation or any documents or thing which in his opinion will be useful for or relevant to any proceeding under this Act are concealed or kept in any place and that there is danger that they may be removed before a search can be effected under Section 16, he may after preparing a statement in writing of the grounds of his belief and of the goods, documents or things for which search is to be made, search or cause search to be made for search goods, documents, or things in that place. (2) An officer or person who makes a search or causes a search to be made under subsection (1) shall leave a signed copy of the aforementioned statement in or about the place reached and shall at the time the search is made or as soon as practicable thereafter, deliver further more a signed copy of such statement to the occupier of the place at his last known address. (3) All searches made under this section shall be carried out mutatis mutandis in accordance with the provision of the Code of Criminal Procedure 1898 (Act V of 1898) (4) Notwithstanding anything contain in foregoing subsection and subject to previous authorization by an officer of customs not below the rank of an Assistant Collector of Customs, any officer of the Customs or any person duly empowered as such may be , with respect to an offence related to exportation of such goods as the Federal Government may, by notification in the official Gazette specified in this behalf- (a) Arrest without warrant any person concerned in such offence or against whom reasonable suspicion exist that he is about to be concerned in such offence; (b) Enter an search without warrant any premises to make an arrest under clause (a) or to seize any goods which are reasonably suspected to be intended for exportation contrary to any prohibition or restriction for the time being enforce, and all documents or things which in his opinion will be useful for or relevant to any proceeding under this Act; and (c) for the purpose of arresting , detaining or taking into custody or preventing the escape of any person concerned or likely to be concerned in such offence, or for the purpose of seizing or preventing the removal of any goods in respect of which any such offence has occurred or is likely to occur use or cause to be used such force to the extent of causing death as may be necessary. (5) the provision of subsection (4) shall apply only to the areas within 5 miles of the land of frontier or Pakistan, and within 5 miles belt running along the sea coast of Pakistan. (6) No suit, prosecution or other legal proceeding shall be instituted except with the previous sanction in writing of the Federal Government against any person in respect of anything done or purporting to be done in exercise of the power conferred by subsection (1) or subsection(2) or, in areas specified in subsection (5) by subsection (4).

7. The requirement for issuance of search warrant by the Magistrate could be dispense with under Section 163 of the Act, which empowers Assistant Collector of Customs or any other Officer of like rank to make search without warrant, if he was satisfied that there was danger of removal of goods if search warrant was obtained and further he had to record such reason in the statement so prepared in writing containing the ground of his belief with regard to danger he apprehend that the goods would be removed before search could be made on the basis of search-warrant and secondly about the goods or documents or things for which the search was to be made. In the instant case the search has been conducted at the appellant under section 163 of the Act without recourse to the mandated requirement of section 162 ibid. Resultant, the same is without lawful authority and jurisdiction and no super structure can be built upon such search, rendering the seizure notice and subsequent preparation of contravention report by the Officers of respondent No. 1 and issuance of show cause notice and passing of orders I by respondents Nos. 2 and 3 as of no legal effect and as such void and ab-initio and this stood fortified from the reported judgment of superior judicial fora at PLD 1991 SC 630, 2003 PTD 1034,2003 PTD 2037, 2004 PTD 2952, 2005 PTD 1933, 2006 PTD 1884, 2007 SCMR 1039, 2009 PTD 1083. The respondent No.1 and his subordinates are even not empowered to ask from the owner of the office/displayed/warehoused goods about the legality of those, unless there exist any provision in the Act or notification to the said effect containing direction that the person, who is operating office for online sale /warehousing of those goods to display the relevant documents in the office/warehouse or to supply to the official on demand. In the absence of availability of any section in the Act and the notification, demanding documents/invoices/bills is nullity to law and hold no ground as held in reported/un-reported judgments K-719/02, H-720/02, H-686/03, Q-776/04, 2005 PTD (Trib.) 135, PLD 1991 Supreme Court 630, 2014 PTD (Trib.) 1566, 2016 PTD (Trib.) 659 and 2016 and PTD (Trib.) 2190 and 2007 SCMR 10 Collector of Customs, Sales Tax and Central Excise v. Prof. Muhammad Khan and 6 others. Wherein their lordship of the Supreme Court examined the aspect that whether Directorate General FBR can demand import documents of any goods or item within the city or during their transport within the territory of Pakistan or not and held that: "law certainly provided protection to a public servant for doing lawful act in discharge of his duty but no such immunity was to be claimed by a person for committing illegal act in his official capacity as a public servant

in the absence of proof that the goods in possession of a person were brought into Pakistan in violation of any law, customs authorities and such other public functionaries had no authority to detain such goods merely on suspicion

petitioner had showed documents of registration in his name to customs official who, having detained the car, insisted the production of import documents for release of car

Detention of car was an act of highhandedness which was committed through misuse of official authority and it might constitute misconduct in terms of Civil Servants (Efficiency and Discipline) Rules, 1973 read with Removal from Service (Special Powers) Ordinance, 2000

Exercise of official authority in a manner in which a person was made victim of misuse of process of law was violative of constitutional guarantees of rights of citizens and a person responsible for violation of such rights of citizens and a person responsible for violation of such rights was to face legal consequences

Act of customs officials might also constitute misconduct, therefore, concerned authorities were under legal obligation to initiate appropriate proceedings against officials involved in the matter."

8. Notwithstanding, it was mandated upon the respondent No.1 and his subordinates to act within the frame work of the definition of the word "smuggle" given in subsection (2)(s) of the Act, verbatim of which is reproduced here-in-under for easement: (a) "smuggle" means to bring into or take out of Pakistan in breach of any prohibition or restriction for the time being in force, or evading payment of customs duties or taxes leviable thereon, (i) Gold bullion, silver bullion, platinum, palladium, radium, precious stones, antiques, currency, narcotics and narcotic and pyschotropic substances; or (ii) Manufactures of gold or silver or platinum or palladium or radium or precious stones, and any other goods notified by the Federal Government in the official Gazette, which , in each case, exceed [one hundred and] [fifty thousand rupees] in value or (iii) Any goods by any route other than a route declared under section 9 or 10 or from any place other than a customs station and includes an attempt, abetment or connivance of so bringing in or taking out of such goods; and all cognate words and expressions shall be construed accordingly.] (b) That customs ports etc. as expressed in clause (iii) of section 2(s) are notified through various notifications in terms of Section 9 of Customs Act, 1969. Whereas, the border area of Pakistan Territory , whereas restriction on the possession of goods in certain areas (borders) as expressed in Section 177 ibid is also notified vide Notification No. SRO 118(I)/83 dated 12.02.1983, ear marking the area of 5 miles adjacent to the Frontier of Pakistan with India and Iran to be the area to which Section 177 of the Customs Act, 1969 shall apply.

9. The goods displayed/ warehoused by appellant were purchased/ procured from the local market against valid invoices, meaning thereby those were neither brought by his supplier or by appellant into Pakistan in breach of any prohibition or restriction for the time being in force under the Import Policy Order, 2009 or while evading payment of customs duties leviable thereon as expressed in clause (a) of Section 2(s). Nor were brought into Pakistan by any other route then the routes expressed in section 9 or 10 of the Act, or from any other place then a customs station as per clause (a)(iii) of section 2(s) instead were sold online on the basis of cash on delivery as per norms of in vogue, those cannot be considered as smuggled by any stretch of imagination. The appellants pointed out that searching of office/warehouse, seizure subsequently for the purpose of adjudication is nullity to the definition of the word "Smuggle", hence, the entire act of the respondent No.1 and his subordinates and respondents Nos. 2 and 3 i.e. right from search, seizure and issuance of show-cause notice and passing of order on the strength of that as ab-initio, null and void.

10. In the light of expressed provision of Section 2(s) and Section 177 of the Act and S.R.O. 118(I)/83 confirms that the displaying /warehousing of goods within the territorial limit of Pakistan do not constitute an offence, meaning thereby that these cannot be termed as smuggling. Even otherwise, it is settled proposition of law that after clearance of the goods under the provision of Section 83 and Rule 442 on the strength of valid assessment order passed under section 80 and Rule 438 of the Act/Rules by the appropriate officer in exercise of the powers vested upon him through SRO 371(I)/2002 dated 15.06.2002 by the Customs either from Area of Sea Port or Dry Port, they are out of the ambit of Customs Department including of respondent No.1 and his subordinates by virtue of becoming functus officio. Any subsequent search of the displayed/warehoused goods within the territory of Pakistan is beyond their jurisdiction, as none of the provision of the Act authorizes any designated official of Customs to search the office/ warehouse on sham plea of smuggling. Reference is placed on the order of the Tribunal in Customs Appeal No. K-719/02, H-720/02, H-686/03, Q-776/04, 2005 PTD (Trib.) 135 and PLD 1991 Supreme Court

630. That the respondents have also lost sight of the legal fiction that if the goods found during the search are freely available in the local market without any curb or restriction such goods least falls within the degree of smuggled as defined in Section 2(s) of the Act and are presumed to be duty paid as held by the Apex Court 1995 SCMR 387 Sikandar A. Karim v. The State. The Double Bench of the Hon'ble Supreme Court comprised of Justice Saeed-uz-Zaman Siddiqui and Justice Mukhtiar Ahmed Junejo held in unambiguous term that "If the item alleged to be smuggled by the prosecution were freely available in the open market and the import of such goods were not banned in the country, presumption could arrive that the goods in question were lawfully brought in the country unless contrary was shown". As per dictum laid down by the Hon'ble Supreme Court the Appellate Tribunal in Customs Appeal No.339/2000 Mr. Muhammad Hanif v. The State and 301/2003 Nasser Ahmed v. Collector of Customs, Sales Tax and Excise , Quetta that held that "to produce legal import documents is nothing but to put undue pressure on the business community despite of the fact that it has been observed number of time by the Supreme Court of Pakistan that the goods which are freely available in the market are presumed to be have been legally imported and duty paid. Even otherwise no reasonable ground has been given in the order-in-original that even for the sake of arguments, it is taken that the receipt produced by appellant and issued by Saifullah Khan have no legal status then also it cannot be concluded that the said transaction was illegal, making way to call upon appellant to produce import documents.

11. The appellants argued that upon submission of valid invoices/bills and payment vouchers, the appellant discharged the initial burden laid upon him and the onus to prove the allegation stands shifted on the shoulders of the Officials of respondent No.1 under Articles 117 and 121 of Qanun-e-Shahadat (10 of 1984) as per laid down law by the Superior Courts of Pakistan namely S.M. Anwar Sethi v. South British Insurance Company Ltd. PLD 1975 Kar. 458; Barkat Ali v. The State PLD 1973 Kar. 659; Cross on evidence 1967, 3rd Edn., London Butterworth; A Practical Approach to Evidence by Peter Murphy 1988 3rd Edn. London, Black Stone Press Ltd; The Modern Law of evidence by Adrian Kean 1985, 1st Den. Oxford , Professional Books Ltd; Mst. Safia Begum v. Mst Malkani and another PLD 1965 Lah. 576; Akber Ali v. Ehsan Ellahi PLD 1980 Lah. 145; Government of Pakistan v. Moulvi Ahmed Saeed 1983 CLC 414; Muhammad Sarwar v. Fazal Rehman 1982 CLC 1286 Sardar Ghulam Nabi Khan v. Azad Government of State of Jammu and Kashmir 1984 CLC 325; Eastern Rice Syndicates v. CBR PLD 1959 SC (Pak) 364; The Collector Central Excise and Land Customs v. Imdad Ali 1969 SCMR 708 and Messrs Latif Brothers v. Deputy Collector of Customs, Lahore 1992 SCMR 1083. This proposition of law was adumbrated upon with clarity by their Lordship of High Court of Sindh in reported judgment PLD 1996 Karachi 68 Kamran Industries v. Colllctor of Customs (Exports) and Order of the Custom Tribunal in Customs Appeal No. K-391/04 Mr. Muhammad Mir v. Collector of Customs (Adjudication) , Karachi. While holding that: "For every offence for which the accused is charged under the Customs Act he shall have to disprove the allegation of the Customs Authorities is entirely without any obligation upon the Customs Department to adduce evidence, it would amount to affording unfettered, naked and arbitrary discretion to the authorities who may at their sweet will make out false cases against importers without the need of proving the sanctity of their actions. Such cannot be the intention of Parliament while the Courts are under an obligation to place such construction on statues which would be beneficial to the widest extent and which would make the legislation operate fairly, justly and equitably and not unreasonably (see Mst. Zainab v. Kamal Khan (PLD 1990 SC 1051). This Court is also of the view that a construction is to be placed upon statutes which would minimize the discretion vested upon the executive authorities. As absolute power corrupts an interpretation fettering the discretion of the executive authority would be more in line with the principles of equity and justice. The issue regarding the applicability of section 187 is to be looked from another angle i.e. in case we were to hold that due to section 187 the entire burden to dispute the entire case rest upon the accused alone. The executive authorities would be let loose and given a wide, naked and arbitrary discretion to operate without any guidelines which would then leave section 187 susceptible to a Constitutional challenge upon its vires on this score alone. By the interpretation as proposed above any redundancy or illegality would also be avoided."

12. The validity of the invoices and payment vouchers were not disputed by any of the respondents neither were they proved fake or fabricated and this stands validated from the comments of the department, as evident from plea taken by the subordinates of respondent No.1 before the Respondent No. 2 that despite visiting several time to the suppliers, no response was given, presumption is that the invoices are true and correct, no negative inference can be drawn as none of the suppliers have denied the issuance of the invoices and receipt of payments as nothing to the said effect has been placed on record of the case either before Respondents Nos. 2 or

3. The fact of matter is Officials of respondent No.1 miserably failed to prove the charges despite mandated under law.

13. The appellants argued that with the submission of the corresponding bills and payment vouchers against the each seized item the appellant , no cause or reason was available with the respondent No.1 and his subordinate to detain, seize the goods displayed/warehoused by the appellant , for the purpose of adjudication and nor for the respondent No. 2 for ordering confiscation of mobiles out-rightly and release of remaining items on payment of 20% redemption fine and imposed penalty of Rs.75,000.00 in addition to leviable duty and taxes on the value ascertained by the official of the respondent No. 1 and so for the respondent No. 2, rendering the said order nullity to the relied upon judgment on each issue and nullity to the judgment of High Court of Lahore in C.A. No. 68/2002 Collector of Customs, Lahore v. S.M. Saleem. The Division Bench of the Lahore High Court, Lahore dismissed the appeal and maintain the order of the Tribunal while holding in Paras 6 and 7 that: "6- it is not denied before this Court that the goods subject matter of this appeal were importable. It is further not denied that the respondent had produced receipts before the Adjudicating Officer but he did not give any enable reason whatsoever as to why this piece of documentary evidence was not relied upon. The operative part of the judgment of the Deputy Collector Customs (Adjudicating) is to the effect that "since no documentary evidence indicating the proper import thereof has been furnished. It is hereby concluded that watches and watches part seized in this case have been brought into country without payment of duty and taxes." 7- the afore-referred view is not in consonance with the law laid down by the August Supreme Court in Pakistan v. Ziauddin (PLD 1962 Supreme Court 440). Wherein the receipt of purchase and payment of money produce by the person from whom smuggled items were recovered was accredited with truth and the court held that he has discharged the burden of proof mandated in section 177 -A of the Sea Customs Act, 1978 at page 446 it was observed as under: The Section requires reasonable belief on the part of the person seizing the goods that an act to defraud the government of duty has been committed. If a person purchases goods as in an ordinary market then in the absence of any suspicious circumstances of some definite fact leading to that inference the custom officer is not entitled to a reasonable belief that the Government has been defrauded of the duty payable on the goods. The ordinary method of the import of goods from outside into Pakistan is that they come through the customs barrier and the duty payable is infact paid. The presumption therefore, with respect to any goods which may be sold in the open market in the absence of an indication to the contrary would be that duty has been paid on them.

14. The appellants rightly pointed out that the orders passed by the respondents Nos.2 and 3 are bad in law and based on assumption / presumption and conjectures and conform that it has not been passed by an independent authority instead by an officer of respondent No. 1 and as such fails the test of judicial scrutiny. This type of order are deems to be not passed independently and with the application of mind and provision of the Act, rendering it non speaking order and least confirms to the mandatory requirement of S.24-A of the General Clauses Act, 1897 validated from the fact that appellant submitted vakalatnama and reply to the show-cause notice being the owner of the company, respondent No. 2 despite the said fact passed order against Mr. Muhammad Aqib Mughal, who is appellant Manager and has no locus standi to claim the goods or to reply. Further validated from the fact that the respondents have not rebutted the grounds of reply/appeal nor any reasoning/rationale has been adduced for ignoring those. Rendering the impugned orders not being passed on objective consideration stand validated from it contents. Such type of orders are deems to be always treated as illegal, void arbitrary and a result of misuse of authority vested in public functionary. No room was available for such illegal, void and arbitrarily orders 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 was illegal arbitrarily without discussing and considering the material available on record it became 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/Appellate orders are being violation of basic principle of the goods governance and mandatory requirement of Section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law. The said position is also fortified by 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 and PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173, 1984 SCMR 1014 and 2012 PTD (Trib.) 619.

15. In the light of law laid down and observation here-in-above, conducting of search of the office/warehouse, preparation of contravention report by the respondent No. 1 and issuance of show-cause notice and passing of order-in-original/appeal by respondent Nos. 2 and 3 are not in accordance with law, hence void and ab-initio and as such is of no legal effect. Therefore, order-in-original is set aside and allow the appeal. SA/27/Tax(Trib.) Appeal accepted.