P L D 1962 (W (PLP)

RAYMOND, J.‑This judgment will dispose of four writ petitions bearing No. 77/1959 and Nos. 142‑144/1959. Of these Writ Petitions Nos. 77/1959 and 142/1959 have been brought by Messrs Hardcastle Wand (Pakistan) Ltd. and Messrs Jan Muhammad Hoosein (Pakistan) Ltd. The latter two writ petitions bearing Nos. 143/1959 and 144/1959 have been brought by Messrs S. M. Abdullah & Sons.

2. The facts giving rise to these four writ petitions may, briefly, be stated. Messrs Hardcastle Wand (Pakistan) Ltd. and Messrs Jan Muhammad Hoosein (Pakistan) Ltd., had indented through Messrs S. M. Abdullah & Sons, Indenting Agents, Chittagong, 21 and 62 cases of cycle lubricating oil, respectively, from Japan. This seas in the first‑half of the year 1957. In both cases, by a forward contract, the importers had sold the goods to be imported by them to Messrs S. M. Abdullah & Sons or their nominee. The goods arrived in Chittagong in October 1957, when, in the usual course of business, the documents in respect of these goods were handed over by the petitioners in Writ Petitions Nos. 77/1959 and 142/1959 to the buyers` Clearing Agents, namely, Messrs Pak Trade-wind Agencies, Chittagong for clearance of the goods. On the basis of these documents received from Japan, the usual declaration forms were filled in and sub mitted to the Customs authorities on behalf of the petitioners.

3. In Writ Petitions Nos. 143 and 144 of 1959, the peti tioners are Messrs S. M. Abdullah & Sons, Indenting Agents, Chittagong, and Writ Petition No. 143 of 1959 deals with the goods to be imported by Messrs Jan Muhammad Hoosein (Pakistan) Ltd. and Writ Petition No. 144 of 1959 deals with the goods to be imported by Messrs Hardcastle Waud (Pakistan) Ltd. The petitioners, Messrs S. M. Abdullah & Sons had, through a forward contract, purchased these goods in each of the above two cases. Thus, it would follow that Writ Petition No. 77/1959 is connected with Writ Petition No. 144/1959, and Writ Petition No. 142/1959 is connected with Writ Petition No. 143/1959. 4 Proceeding further with the facts giving rise to these petitions, it appears that when the goods of Messrs Hardcastle Wand (Pakistan). Ltd., were examined and checked by the Customs authorities, it was found that in place of the 21 cases of lubricating oil mentioned in the shipping documents, there were only 12 cases of lubricating oil and 9 cases of fountain pens. In like manner, when the goods imported by Messrs Jan Muhammad Hoosein (Pakistan) Ltd., were examined and checked by the Customs authorities in Chittagong, it was found that instead of 62 cases of cycle lubricating oil, there were only 33 cases of this lubricating oil and 9 cases of press buttons, and 20 cases of Art Silk Fabrics. The Customs authorities then issued show‑cause notices to Messrs Hardcastle Waud (Pakistan) Ltd. and Messrs Jan Muhammad Hoosein (Pakistan) Ltd., who in' their replies mentioned that the goods, though imported in their names, yet actually did not belong to them having been sold by them through a forward contract to Messrs S. M. Abdullah & Sons. Thus, similar slow‑cause notices were served by the Customs authorities upon Messrs S. M. Abdullah & Sons.

5. Replies were sent by the four petitioners in these four writ petitions to these show‑cause notices, but it is alleged that the Collector of Customs, Chittagong, respondent No. 3 in each of these four writ petitions, without affording an opportunity to the petitioners of a hearing in person, heavily penalised the petitioners In Writ Petitions Nos. 77/1959 and 142/1959 for having made false declarations and also heavily penalised Messrs S. M. Abdullah & Sons, the petitioners in Writ Petitions Nos. 143/1959 and 144/1959 for the fraud practised by them whereby goods of far‑higher value were brought into the country without a proper import licence. It is unnecessary for the purposes of this judgment ‑to set out here the precise details of the heavy penalties imposed by the respondent No. 3, namely, the Collector of Customs, Chittagong upon each of the four petitioners in these four writ petitions.

6. In. completing the statement of facts giving rise to these f6ur writ petitions, it remains to be added that the petitioners appealed to the Central Board of Revenue (respondent No. 2 in each of these 4 writ petitions) questioning the order of the Collector of Customs, Chittagong (respondent 3), but all these appeals were dismissed by the Central Board of Revenue at Karachi. Thereafter, the petitioners went in revision to the Central Government (the respondent No. 1 in each of these writ petitions) and these revision petitions were also rejected by the Government of Pakistan, Ministry of Finance (Revenue Division). The petitioners then filed these four writ petitions.

7. Appearing on behalf of Messrs Hardcastle Waud (Pakistan) Ltd. and Messrs Jan Muhammad Hoosein (Pakistan) Ltd., the petitioners in Writ Petitions Nos. 77 and 142 of 1959, Mr. Sharifuddin Pirzada raised a number of interesting points but inasmuch as we find that these writ petitions can easily be disposed of by us on the very first point raised by him, it is unnecessary for us to set out in this judgment the other points placed before us by Mr. Pirzada. It should be added here that Mr. Shah Jamil Alam, the Advocate for Messrs S. M. Abdullah & Sons, petitioners in Writ Petitions Nos. 143 and 144 of 1959, adopted the same arguments of Mr. Sharifuddin Pirzada.

8. The first argument of Mr. Sharifuddin Pirzada was that his clients have been punished for contravening section 39 of the Sea Customs Act. This section, so far as it is relevant for purposes of the present writ petitions, is in these words: "

39. Payment of duty short paid or erroneously refunded.‑(1) If any person, in connection with any matter of Customs,‑ (a) make.,; or signs, or causes to be made or signed, or delivers or causes to be delivered to an officer of Customs any declaration, notice, certificate or other document whatsoever, or . (b) makes any statement in answer to any question put to him by an officer of Customs which he is required by or under this Act to answer, and such document or statement is untrue in any material particular, he shall be guilty of an offence under this section." Mr. Sharifuudin Pirzada laid emphasis on the words "such document or statement is untrue in any material particular." He argued that, before any person can be found guilty of an offence under this section, it must conclusively be established that the statement or document made by him is "untrue in any material particular", and the word "untrue" means that the statement or document is false or incorrect to the knowledge of the person making it. Mr. Sharifuddin further argued that it is not every false or incorrect statement in connexion with any matter of Customs that renders the maker liable under section 39 of the Sea Customs Act, but only such statements or documents which the maker knows, or has reason to believe, to be false and incorrect. In support of this contention Mr. Sharifuddin invited our attention to the well known Eastern Rice Syndicate case decided by our Supreme Court on 25th June 1959 (P L D 1959 S C (Pak.) 30). In particular, he invited our attention to paragraph 2, on page 368, and to the passage in this paragraph, where their Lordship's state: "There need be no doubt whatsoever that the word `untrue' carries the sense of falsity to the knowledge of the person concerned." Item 9‑B of section 167 of the Sea Customs Act provides for the punishment for a contravention of section 39 of the same Act, and dealing with this item their Lordships, at page 372, haze expressed themselves in these words: "We have already indicated our opinion that the word `untrue' conveys the sense that the requirement of law is that in order to attract the penalties of item (9‑B) on the basis of a wrong statement made by the person concerned there must be falsity to the knowledge of that person."

9. Mr. S. J. Alam appearing on behalf of petitioners in Writ Petitions Nos. 143 and 144 of 1959 adopted the arguments of Mr. Sharifuddin Pirzada and hence it is unnecessary to repeat them here. But Mr. Muzaffar Hasan, the learned Advocate of the Customs authorities appearing on behalf of the three respon dents in these writ petitions, endeavoured to persuade us to dis tinguish the decision of their Lordships of the Supreme Court in the above‑mentioned case from the facts of the present cases. His main contention was that in the Eastern Rice Syndicate case their Lordships of the Supreme Court were only concerned with correct valuation, whereas in the instant cases we are concerned with the commission of a statutory offence. In the present four cases, false declarations have been filed, and in these cases goods of high market value and in respect of which there was no import licence have wrongly been brought into the country. Mr. Muzaffar Hasan argued that, inasmuch as section 39 creates a statutory offence, the question of knowledge or mens rea is perfectly immaterial, and in this view the petitioners have rightly been penalised for their wrongful acts.

10. We have listened attentively to the arguments advanced before us and particularly to the endeavours of Mr. Muzaffar Hasan to draw a distinction between the Eastern Rice Syndicate case and these four present writ petitions. We have closely studied the judgment of Cornelius, J., (as he then was) in this Supreme Court case, and we find that there is no escape from the conclusion that a necessary ingredient for an offence under section 39 punishable under Item 9‑B of section 167, Sea Customs Act, is that the incorrectness or falsity of the statement or" A document must be to the knowledge of the person concerned.1 In this judgment, Cornelius, J., has emphasised the fact that the word used in section 39 of the Sea Customs Act to bring a statement within the mischief of that section, is "untrue" and not merely "incorrect." This word "untrue" is obviously more pregnant with meaning than the word "incorrect", and when given its full meaning and significance in the context in which it is used in section 39, it can only mean that the statement concerned must be false and incorrect to the knowledge of the person concerned. Nor can we hold that the passages appearing to this judgment, mentioned above, and to which our special attention was invited by Mr. Sharifuddin, are mere remarks obiter dicta: though we are aware of the view of their Lordships of the Supreme Court expressed in a previous judgment that even remarks sobiter dicta of their Lordships appearing in a judgment of the Supreme Court are binding on every other Court in the land.

11. We find in these cases before us that the Customs authorities have not proved or established that the false declaration, or the fraud practised upon them, was false to the knowledge of the petitioners in these four writ petitions.

12. The petitioners in Writ Petitions Nos. 77 and 142 of 1959, submitted declarations on the basis of documents received by them from Japan without having a chance of seeing the goods or of knowing their contents. In like manner, the petitioners in Writ Petitions Nos. 143 and 144 of 1959 acted as the Indenting Agents of the other two petitioners, and there is not an iota of evidence on record to indicate that they were in league with the principals in Japan who packed and exported these goods. We have heard the argument of Mr. Muzaffar Hasan that since a mistake of this kind has occurred only in the case of these Indenting Agents, these principals in Pakistan, and the same firm of exporters in Japan, it may fairly be presumed that all these three are in collusion with each other. But this argument, although it may at most point the finger of suspicion at these petitioners, yet it cannot take the place of proof. We must, therefore, hold that on the record before us there is no material whereby it can be said that the petitioners in these four cases had the requisite knowledge so as to fix them with liability under section 39 of the Sea Customs Act.

13. We have mentioned, in passing, above that the decision of our Supreme Court in the Eastern Rice Syndicate case was pronounced on the 25th June 1959. This date is later than the decisions of the three respondents impugned in these writ petitions, so that it can well be said that when these respondents reached their decisions in these cases, they did not then have the advantage of this judgment of the Supreme Court before them. We may be permitted to express the hope that now that section 39 has been interpreted by the Supreme Court for the benefit of the people of Pakistan, the Customs authorities when interpreting this section would allow themselves to be guided by the interpreta tion placed upon this section by our Supreme Court. In fact, if the Customs authorities should feel that they are in a position to establish that the petitioners in these writ petitions did know and were aware of the fraud that has been practised upon the Customs authorities in these cases, it is open to these authorities to issue fresh notices to these petitioners and to proceed against them in accordance with the provisions of the Sea Customs Act.

14. In the result, therefore, we allow these four writ petitions with costs. A. H. Petitions allowed.