Allegation of misdeclaration

2018 PTD 1273 CUSTOMS-APPELLATE-TRIBUNAL-LAHORE Judicial Precedent

Ss. 26-A, 32, 79, 80 & 83S.R.O. No. 500(I)/2009, dated 13-6-2009Allegation of mis-declarationDeclaration was transmitted under PCT Heading 3105.9000Importer deposited upfront and taxes as pre-requisite

Prior to completion of assessment, goods declaration was referred for examination, and declaration was confirmed on the strength of posted examination report

Competent authority passed assessment order and changed the PCT Heading as 2503.0000 and transmitted view message for payment of additional amount of duty and taxes; which the importer paid and Authority passed clearance order and the importer obtained the delivery of the goods

Subsequently, Assistant Director of Directorate of Post Clearance Audit purportedly conducted audit of the goods declaration of the importer in terms of S.26-A of the Customs Act, 1969, wherein it was observed that the goods imported by the importer fell under PCT Heading 3824.9090 attracting 10% customs duty

Assistant Director framed contravention report and Deputy Collector of Customs, Adjudication, issued show-cause notice, with the allegation that the importer obtained the clearance of the goods under erroneous PCT Heading as against actual applicable PCT Heading 3824.9090 on which customs duty was leviable at 10%

Said act of the importer was alleged to fall within the ambit of S.32 of Customs Act, 1969 punishable under S.156(1)(14) of the said Act

Validity

Under provisions of S.26-A of the Customs Act, 1969, appropriate officer of customs conducting any audit, would proceed in the manner as the Federal Board of Revenue could by rules prescribe

No rules were framed/issued by the Board despite insertion in S.26-A of the Customs Act, 1969 through Finance Act, 2006

Assistant Director, Post Clearance Audit, was not at all appointed/designated as officer of Inland Revenue, hence he was not empowered to exercise the powers of an officer of Inland Revenue for conducting the audit

Entire act of audit, being without power/jurisdiction was coram non judice

Exercise of jurisdiction by Deputy Collector of Customs, Adjudication, was also without lawful authority and jurisdiction

Issuance of show-cause notice and passing of order-in-original, were held to be ab initio void and as such coram non judice

Assessment order under S.80 of the Customs Act, 1969 and passing of clearance order under S.83 of said Act, could not be disturbed by any Authority for the purpose of preparing contravention report and adjudicating proceedings

Only course left for Assistant Director of Post Clearance Audit was to challenge the said order before the Collector of Customs (Appeals) under S.193 of the Customs Act, 1969, in exercise of the powers delegated upon him through S.R.O. No.500(I)/2009, dated 13-6-2009

In the presence of an appealable order, fresh order could not be passed, even through issuance of show-cause notice

Transaction, which stood as passed and closed transaction and attained finality, could not be disturbed

Assistant Director implicated and Deputy Director of Customs charged importer for mis-declaration under provisions of S.32 of the Customs Act, 1969, merely on the basis of assumption/presumption

Show-cause notice providing the basis for impugned orders by the forum below were vacated/set aside by the Tribunal, in circumstances.

2015 PTD 2584 CUSTOMS-APPELLATE-TRIBUNAL-LAHORE Judicial Precedent

Ss. 32(1), 32(2) & 179SRO 886(I)/2012 dated 18-7-2012Allegation of misdeclarationContents of show-cause notice showed that there was no revenue loss by virtue of alleged mis-declarationImporter had not submitted any forged/false documents/declaration which was evident from show-cause noticeValidity

Sections 32(1) & 32(2) of Customs Act, 1969, were not to be read in isolation, instead in conjunction with S.32(2) or S.32(3) of Customs Act, 1969

Powers vested with Department under S. 179 of Customs Act, 1969 had not been withdrawn through S.R.O. 886(I)/2012 dated 18-7-2012

According to S.R.O. 886(I)/2012 cases involving technical violation of import or export restriction without involvement of any evasion of duty and taxes, would not be adjudicated by adjudicating officer of Customs

Powers of adjudication were specific and empowered by statute.

2012 PTD 1650 Customs, Federal Excise and Sales Tax Appellate Tribunal Judicial Precedent

S. 32Allegation of misdeclarationApplication of S.32, Customs Act, 1969Mandatory prerequisites

Issue for consideration was, whether allegation of misdeclaration levelled at against the importer, was factually and legally sustainable

Allegation of misdeclaration in terms of S.32 of Customs Act, 1969 had been levelled against the importer on the basis of an irrelevant, vague and incomplete invoice purported to be issued by another shipper

Retrieved invoices had neither been prepared by the importer nor those had been delivered by the importer to the Customs Authorities

Authorities had not been able to produce any evidence against the importer in respect of opening of letter of credit or remittance of foreign exchange for the purpose of importation of the subject goods at enhanced price against the "so called" invoice

Onus of proof lay on the customs

Case seemed to have been built up by the authorities on the basis of retrieved documents assumed to be commercial invoices, which were not to be relied upon for institution of a case of misdeclaration against the importer in terms of S.32 of the Customs Act, 1969

In order to attract the mischief of punitive provision of S.32 of the Customs Act, 1969, the mandatory prerequisite was that accused should have made or signed or declared or caused the same before Customs Authorities on the form of any declaration notices, certificate or any documents, or should have made any statement while replying the queries put to him by an officer of Customs, with knowledge and belief that such documents or statements were false in any material particular

In absence of any document, declaration notice made, signed or delivered to the Customs Authorities, the charge of misdeclaration, could not be framed against the importer

Said issue was answered in the negative.