1991 PLP 88 (SCMR)

Nemo.for Respondent. Date of hearing: 28th February, 1990. SHAFIUR RAHMAN, J.‑‑The petitioners, Pakistan and its functionaries, seek leave to appeal against the judgment of the Lahore. High Court dated 13th of March, 1988, whereby a Constitution Petition filed by the respondent was allowed and the decision of the petitioners was declared to be without lawful authority and 'of no legal effect.

2. The respondent and its sister concern, M/s. Seema Corporation, Lahore, imported a substance called Ethanol G.R. The duty adjudged was paid. On a secret information received by the Directorate of Vigilance, Customs Department, that there was a misdeclaration and a short‑payment of duty, the Matter was reopened and the chemical imported was recovered, not from the respondent, but from the Government Medical Stores Depot. Out of 800 litres of ethanol supplied to the Government Medical Stores Depot, only 184 litres were available while the rest had been consumed. The goods were cleared under the Pakistan Customs Tariff heading No. 38.19 at the rained at length, the contents of the chemical, its possible uses and its classification, and remarked as hereunder:‑ It is obvious that what was imported was Ethanol (Ethyl Alcohol) G.R. The Pro forma Invoice and the shipping document of the exporter lists this product as "Ethanol (Ethyl Alcohol) Absolute G.R.". The letters "G.R." mean guaranteed reagent and the word "Absolute" means strength of 99.9 per cent. It is obvious, therefore, that the Ethanol G.R. imported was of analysis grade, meant for use asined at length, the contents of the chemical, its possible uses and its classification, and remarked as hereunder:‑‑ . It is obvious that what was imported was Ethanol (Ethyl Alcohol) G.R. The Proforma Invoice and the shipping document of the exporter lists this product as "Ethanol (Ethyl Alcohol) Absolute G.R.". The letters "G.R." mean guaranteed reagent and the word "Absolute" means strength of 99.9 per cent. It is obvious, therefore, that the Ethanol G.R. imported was of analysis grade, meant for use as an analytical/diagnostic reagent in the laboratories. It cannot be denied that it is a product which is used for analytical purposes in the laboratories and also as a dehydrating reagent in the tissue processing of making slides for diagnostic purposes in the Pathological Laboratories and is, therefore, a composite reagent. Scientifically there is no product which is a composite reagent. Any alcohol, acid, alkali is a reagent. The word "composite" in heading 39.08 C 05 is in terms of its use as both an analytical and a diagnostic reagent, i.e. a reagent that can be used for both the purposes. Ethyl Alcohol is not listed in catalogues under the heading Beverages, but in catalogues of Laboratory Chemicals/Reagents. The import licences which were granted by the Government of Pakistan to cover the import of this product was also under the heading Chemicals. The fact that the Ministry of Commerce ordered release of the said goods as chemicals, on the ground that it had to be used for analytical/diagnostic purposes in the laboratories is, therefore, not without meaning. The fact that the product was' imported for supply to Government Medical Stores Depot, Lahore, for distribution to Pathological Laboratories; clinches the matter. The case of the Customs Authorities that the product falls under P.C.T. 22.08 does not make sense. Ethanol G.R. at 99.9 per cent purity cannot be consumed by human beings, as it would be fatal. If Ethanol G.R. was an alcoholic beverage or an alcohol drink, it would not be catalogued under chemicals or reagents. Taking all circumstances into consideration, the product appears to fall clearly under P.C.T. heading 38.19 C 05. ‑

3. The learned Deputy Attorney‑General has mainly contested the re‑classification as ordered by the High Court. His contention is that the Departmental view suffered from no such infirmity as could have justified the interference by the High Court.

4. The history of the case shows that even at the import stage the respondent was confronted with certain impediments as to whether it was a banned product or not, and what was its classification. It was ultimately the Government of Pakistan itself in the Commerce Division which permitted its import as a chemical for analysis and diagnostic purposes. The matter was actively at that stage under consideration. Subsequently, nothing new turned up. The recovery was made from the Government Medical Stores Depot. A large portion of the imported stuff had already been consumed in what appeared to be proper diagnostic and analytical institution. A re‑classification of the same without ensuring the percentage contents, was undertaken. In such circumstances the High Court had correctly reviewed the administrative action by separating what was not relevant from what was relevant and basing a conclusion on the relevant data.

5. No question requiring further examination arises in the case and leave to appeal is refused. A.A./D‑74/S, Leave refused.