Messrs PUNJAB ARMS CO., LAHORE through Proprietor vs DEPUTY COLLECTOR

The petitioner on the basis of Pro forma Invoices dated 30-10-2002 established LC dated 21-11-2002 for the import of 100000 pcs of .30 bore pistol cartridges of Chinese origin at unit value of US$ 17/1000 pcs of total import value of US$ 1700.00. The shipment was received. The relevant Bill of Lading was dated 7-9-2003. On arrival of the consignment at Lahore Dry Port, the petitioner filed Bill of Entry No,4377 dated 18-10-2003 seeking assessment on the basis of declared value.

2. The declared value was not accepted. A notice under section 25(4) of the Customs Act, 1969 was served on the petitioner. Reply was filed by the petitioner on 10-11-2003 reiterating that the correct value was declared. The consignment was however provisionally assessed under section 81 of the Customs Act, 1969 at US$ 50/pc. The payment of duties and taxes was accordingly made. The petitioner also furnished post-dated cheques for the differential of the amount. The consignment was released on 21-11-2003.

3. Subsequently, without any hearing or opportunity of explanation to the petitioner, show-cause notice dated 10-5-2004 was served on the petitioner under section 81(3) of the Customs Act, 1969 demanding enhanced amount on the basis of a purported valuation advice dated 24-4-2003 at US$ 87/1000 rounds. The petitioner filed an application dated 28-5-2004 seeking copy of the valuation advice which was provided to the petitioner by the respondents on 4-6-2004. The said valuation and the proceedings undertaken by the respondents thereupon were challenged through the present Constitutional petition by the petitioner. The main ground urged was that the valuation advice was issued without Notification in terms of section 25 of the Customs Act, 1969 and the Rules framed thereunder and it was thus ultra vires the law.

4. The petition was admitted to the regular hearing on 10-6-2004. Written statement in the form of parawise comments was filed on behalf of respondent No,3. In Ground-E of the reply, it was clearly acknowledged by the respondent that:--- "It is admitted that the valuation advice dated 24-4-2004 is neither a notification nor fixation of value under subsection (14) of section 25 of the Customs Act, 1969."

5. The learned counsel for the respondents also admitted at the bar that the valuation was not fixed by the respondents through a proper notification in terms of section 25 of the Customs Act, 1969.

6. This Court in W.P. No,7752 of 2004 titled Messrs Siddique International v. Assistant Collector (Customs) referring to the findings in the cases titled Messrs Al-Huda Enterprises v. Central Board of Revenue and Wasim Khan v. Additional Collector of Customs W.P. No,4319 of 2000 observed: "3.............that Central Board of Revenue or any other authorized officer can fix the minimum customs value of goods specified in the First Schedule and Second Schedule through a Notification and the impugned letter not being a Notification cannot have any legal effect whatsoever.

Accordingly, it is declared to be without jurisdiction." 3-A Under the provisions of subsection (14) of section 25 of the Customs Act, 1969, Central Board of Revenue or any other authorized officer can fix the minimum customs value of goods specified in the First Schedule and Second Schedule only through a Notification.

4..........In view of the above, the impugned letter and any further proceedings or orders passed thereupon are held to be without lawful authority and of no legal effect."

7. No distinguishing feature in this case has been shown by the respondents. The respondents have very candidly admitted that the valuation was not finalized through a notification as required, by law. The principles and the conclusions recorded in the above-referred cases directly apply to this case as well.

8. This petition is thus accepted. The impugned valuation advice dated 24-4-2004 and the demand based thereupon is declared to be without lawful authority and of no legal effect. There shall however, be no order as to costs.