P L D 1989 Karachi 598 (PLP)

QAISER AHMED HAMIDI, J.‑‑For the purposes of this Constitutional petition the following statement of facts would suffice:

2. The petitioner imported a consignment of 150 packages containing 300,000 pieces of TEATS CANON BABY SAFE in bulk packing from M/s. Canon Rubber Singapore (Pvt.) Ltd.; against import licence No. A‑858465, issued under Serial No.60 of the free list of Import Policy Order, 1980, at a price of US Dollars 0.025 per teat. The consignment arrived at Karachi on 27‑8‑1981, but its clearance was delayed for about three months by the Customs Authorities, during which period demurrage continued to mount. Eventually a show‑cause notice, dated 25‑11‑1981 was issued to the petitioner by the Deputy Collector Customs, Karachi, raising the following objections in relation to the said consignment:‑ (a) That the air freight payable on the said consignment was Singapore Dollars 16,203 (i.e. Pak. Rs.77.774.40), which was, too high as compared to the total value of the consignment. (b) That the value declared at the rate of US Dollars 0.025 per teat was incorrect and the actual value was US Dollars 0.125 per teat C & F (sea) or US Dollars 0.135 per teat C & F (air). (c) That the consignment was not covered by the import licence, which related to Serial No .60 of the free list of import Policy Order, 1980.

3. A photo copy of a telex message purportedly sent by M/s. Canon Rubber Singapore (Pvt.) Ltd. to some unnamed party quoting a price of US Dollars 0.125 C & F (sea) or U5 Dollars 0.135 C & F (air), was attached with the said show‑cause notice. This telex message was in fact the sole basis for the issuance of the show‑cause notice. The petitioner replied to the show‑cause notice, thereby controverting the allegations based on facts. As regards the contravention of I.T.C.. it was pleaded that a rubber teat is a scientific appliance for dispensation of milk and, therefore, by description and I.T.C. Schedule No., its import was covered by import licence of the petitioner.

4. The case came up for hearing before the Deputy Collector Customs on 10‑1‑1982 when the representative of the petitioner clarified the above points. The Deputy Collector Customs, however, demanded the following documents:‑ (a) Certificate from P.I.A. regarding the actual freight received for the consignment. (b) Certificate from Income Tax Department, Singapore, to establish that the suppliers had paid the above freight. (c) Certification of samples of old and new teats by the Chamber of Commerce, Singapore.

5. Another attempt was made by the petitioner to satisfy Deputy Collector Customs Karachi, about the consignment. A representative of suppliers had also come to Pakistan and he too tried to explain the situation, but without success.

6. On 10‑4‑1982, the Clearing Agents of the petitioner informed him that they have received a letter, dated 8‑4‑1982 issued under section 82 of the Customs Act, 1969, stating therein that the said goods would be disposed of on 11th April, 1982 as abandoned goods unless cleared by 10th April, 1982. The petitioner, who had not received the order, dated 8th April, 1982, approached the Deputy Collector Customs for postponement of the said auction, but without any result, hence the present petition.

7. The question that the imported goods were covered by import licence for Serial No.60 of the Import Policy Order, 1980, need not detain us long. The entries at Serial No.12 and Serial No.60 of the free list contain a reference of Article 40‑12‑III of the I.T.C. Schedule, which specifically refers to teats. A rubber teat is essentially a scientific appliance for dispensation of milk and, therefore, by I.T.C. Schedule mentioned above its import was covered by the import licence of the petitioner. Mr. S. Inayat Ali, learned counsel for respondents has also conceded to this position.

8. The main controversy between the parties centres round the low value of teats, which according to respondents was due to misdeclaration. The petitioner has placed‑ reliance upon the letter of the suppliers, dated 12th May, 1981, which is on record. At page 2 of this letter the suppliers made the offer in the following words:‑ "you may, however, be interested to know that we have a small stock of about 300,000 pieces of the old design still lying in our warehouse from the 1980 production. Because of the discontinuation of the old design, we will be pleased to quote you US Dollar 0.025 each C & F Karachi by air freight."

9. This letter of the suppliers clearly specifies the reasons leading to the introduction of the new design as well as the technical improvements made therein. This letter was not considered by respondent No. 1, who adopted a manifestly illegal approach in relying upon the evidence collected at the back of the petitioner. The respondent No.l, also acted illegally in relying upon a private conversation between him and the representative of the suppliers. The rules of natural justice which are applicable to all Courts, tribunals and authorities, acting in a judicial or quasi‑judicial capacity, were, thus violated.

10. The demand of a certificate from Income Tax Departments Singapore, about the actual freight paid and the certification of the samples of old and new teats by Chamber of Commerce Singapore, made by respondent No.l was again uncalled for. The petitioner was not in a position to have obtained such certificates, more so when the tax records are confidential documents.

11. We now address to the question whether special rebate was allowed by P.I.A. for this consignment, as pleaded by the petitioner. It is contended on behalf of the petitioner that such rebates are normally given in contravention of IATA regulations and the P.I.A., as a member of IATA would never issue a certificate showing the rebates. As the onus of proof lay upon the petitioner it was for him to have satisfied the Deputy Collector Customs about the actual freight paid by him on this consignment.

12. Since the impugned order was passed in disregard of the rules of natural justice, we allow the petition and declare the impugned order as being without legal authority and of no effect. However, the case is remanded back to respondent No.l with the direction to decide the matter afresh in the light of observations made in para. Nos. 9 and 10 of this judgment. Till then the Batik Guarantee will not be encashed. There will, however, be no order as to costs.

13. At the conclusion of the hearing, we had by a short order allowed the petition. These are reasons for the said order. A . A . / A‑594/ K Petition accepted