Appeal No.525/LB of 2000, decided on 13th April, 2005. Versus Appeal No.525/LB of 2000, decided on 13th April, 2005.

MIAN MUHAMMD JAHANGIER, MEMBER (JUDICIAL).--- This appeal directed against Order-in-Original 78 of 2000 passed by Assistant Collector of Customs Air Port Traffic Lahore Airport, Lahore Limed 30-6-2000 whereby the Assistant Collector out rightly confiscated the goods (cloth) recovered from the possession of the appellant, an Indian national.

2. Some relevant facts of the case are that at the time of clearance of Flight No.PK 271 dated 23-5-2000 coming from Dehli, the passenger named Abdul Sami, an Indian national failed to declare the cloth measuring 1190 yards brought by him in his baggage consequently, due to violation of various provision of law the contravention case was referred to the Assistant Collector of Customs where from show-cause notice was issued but the appellant requested for release of his goods on payment of duty and taxes as he brought the goods for his relatives. Besides it, in his reply to he show-cause notice he submitted that he had declared the goods and on the direction of Customs Inspector he placed his baggage for scanning and further requested for re-export of the seized goods. Assistant Collector observed that the appellant brought the goods for sale in open market in Pakistan. The operative part of the impugned order is as under:-

"I have examined the case record. It is an admitted fact that the passenger namely Abdul Sami has brought the goods in commercial quantity in violation of Baggage Rule, 1998 as notified vide S.R.O. 570(I)/98 dated 12-6-1998. Admittedly the passenger has contravened the aforesaid provisions of the Customs Act, 1969 and section 3(1) Imports and Exports Control Act, 1950. The passenger brought the goods with the intention to sale in open market in Pakistan and therefore, had not fulfilled the certain conditions in terms of section 142 of Customs Act, 1969. The request for re-export of the goods is thereof, regretted. I, therefore, order outright confiscation of the goods in favour of the State." Hence this appeal.

2-A. We have heard the learned counsel for the appellant and Mr. Asad Farooq Inspector for the respondent.

3. Learned counsel for the appellant argued that the appellant brought 1190 yards cloth along with him for gifting to the relatives and for his own expenses in Pakistan and it was declared at the customs counter but he was informed that the cloth being in commercial quantity is hit by restrictions and limitations imposed on which the appellant requested for release of the cloth on payment of customs and duties as required by the law or he should be allowed to carry the goods back to India on his return but application in this regard was not accepted that so-far-as return of the goods was concerned, a report was called from Superintendent Customs for having the goods back to India and re-export was recommended under section 142 of the Customs Act 1969 but despite this the goods were confiscated without any basis; that the show-cause notice served upon the appellant was illegal as it did not contain the allegation of violation of section 2(s) of the Customs Act 1969; that if there was any restriction or prohibition on bringing the goods into Pakistan from India the appellant should have been admitted to take the goods back under section 142 of the Customs Act 1969, therefore, in all circumstances as indicated above the order impugned was .not justified and being illegal is liable to be set aside, which have been opposed by Mr. Asad Farooq Inspector who submitted that order dated 30-6-2000 is in accordance with law and facts on the record.

4. One thing is admitted that the appellant being an Indian national came from India and he brought 1190 yards cloth of different types due to which the case of prosecution is that the appellant violated the provision of sections 16, 32 and 139 of Customs Act, 1969 read with Baggage Rules, 1998 notified vide S.R.O. 570(I)/98 dated 12-6-1998 and section 3(1) of Imports and Exports (Control) Act, 1950.

Section sixteen (16) speaks about power of the Federal Government to prohibit the importation and exportation of goods by air sea or land, section 32 of the Customs Act, 1969 mainly reflects on making declaration, notice, certificate or other document in connection with the customs matter before an officer of the customs and if any such activity is false either deliberately or due to inadvertence resulting into loss to the Government Revenue in any manner, the person so making shall be guilty of an offence under this section and section 139 deals with a declaration either oral or written made by the owner of the baggage or member of the crew for clearance of the goods before an officer of the customs therefore, in accordance with the declaration the concerned person has to produce the baggage for examination.

And so far as the Baggage Rules, 1998 notified vide S.R.O. No.570(I)/98 dated 12-6-1998 are concerned, these apply to the passengers arriving from India and others, anyhow chapter four (4) reflecting on concession for passengers arriving from India is as follows:-

"19. This chapter shall apply to the baggage of passengers arriving from India.

20. Allowance Admissible to Indian national .---(1) An Indian national may, subject to the conditions laid down in sub-rules (2) and (3), import free of customs duty and taxes the following goods on his person or in baggage, namely ???????????

(a) used articles of personal wearing apparel and articles in personal use for satisfying daily necessities of life;

(b) personal jewellry up to an aggregate value of fifteen US dollars in the case of a male passenger and twenty five US dollars in the case of a female passenger;

(c) one wrist watch;

(d) one still camera;

(e) one movie camera;

(f) one pair of binoculars;

(g) one portable tape-recorder;

(h) one portable typewriter;

(i) one portable transistor or radio set;

(j) professional tools, instruments and latest usually carried in the course of passengers profession or calling.

(k) fifty cigars or hundred cigarettes or two hundred bidies or hundred grams tobacco;

(l) small quantity of perfume and medicine in reasonable quantity; and

(m) articles for personal use or for making gifts up to the aggregate value of twenty five US dollars. This allowance shall be halved on the second visit and shall not be admissible on the third or subsequent visit in a calendar year.

(2) No articles specified in clauses (b) to (j) of sub-rule (1) shall be allowed free of customs duty and taxes unless the passenger gives an undertaking, in writing, to the proper officer of Customs to re-export it out of Pakistan at the time of his departure from Pakistan and on his failure to do so he. shall be liable to pay the duty leviable thereon including the penalty that may be imposed under any law or rules for the time being in force.

(3) Every passenger after the examination of his baggage, shall prepare a list of articles specified in clauses (b) to (g) of sub-rule (1) in the form to be supplied by the Customs, and get it countersigned by the officer of Customs who examines the baggage.

(4) The list of articles referred to in sub-rule (3) shall be produced by the passenger at the time of his departure from Pakistan failing which the baggage may not be cleared by Customs for export and the passenger may be made liable to pay customs duty and taxes leviable thereon along with such penalty as may be imposed under any law or rules."

5. The perusal of S.R.O. as mentioned above would show that the definitions of Baggage Gift Allowance, Personal allowance, the extent of admissibility of gift allowance, prohibitions, the declaration and concessions are given therein and it is also explained that the allowance is not admissible in case the goods are in commercial quantity and so-far-as the concession for passengers arriving from India are concerned, there is no reference of cloth to bring the same free of customs duty and taxes, meaning thereby the cloth is such an item if it is brought from India and declared in accordance with law, the customs duty and other taxes have to be paid.

6. The perusal of recovery memo. Annex-2/2 would show that the appellant brought printed Shafoon (Jarjit Dupatta) ladies cloth 770 yards and 420 yards of white cloth (ladies) Arganza Type 1190 yards in total. The perusal of banned items list as given in Import Trade and Procedure Order for the year 2003-04 would show that this kind of cloth is not included in the banned items. The question worth consideration is as to on what basis the Adjudication Officer has forfeited the cloth. First of all he has observed that the appellant brought the cloth in commercial quantity and secondly he has not fulfilled the certain conditions in terms of section, 142 of Customs Act, 1969. So-far-as the question of bringing the goods in commercial quantity is concerned, it appears as if no limit of cloth for import from India is given in the Baggage Rules or in other words the commercial quantity is not defined therefore, it can be argued that the quantity of cloth brought by the appellant might be for the use of relatives and friends and if the goods are to be treated in commercial 1 quantity, the 10 yards of cloth may be observed as commercial quantity as same can be sold in the open market under a necessity therefore, if the cloth is brought in huge quantity it can be cleared on payment of customs and other duties and this principle should be followed in case of a passenger who is coming for first time from India to Pakistan as the mistakes as a stranger such like a mistake in declaration are expected.

7. Now the next question worth consideration is as to what are the conditions given in section 142 of the Customs Act, 1969. These conditions are as under:---

(a) The article is dutiable or the import of which is prohibited or restricted.

(b) A true declaration has been made under section 139 ibid.

(c) The appropriate Officer is satisfied that these were not imported with the intention of consumption in Pakistan.

And the appropriate officer on the request made by the passenger may allow the export of such goods as and when the passenger leaves Pakistan. The only question relevant for discussion in this connection is as to whether the appellant made a true declaration, it appears from the perusal of impugned order and other record as if the appellant made declaration orally before the customs authority. Such type of verbal declaration is permitted under section 139 of the Customs Act, 1969 but it gives birth to many apprehensions and may force to believe as if stereo type proceedings have been completed therefore, in order to make the situation transparent like mirror, the declaration made by the passenger like other documents may be written and for the sake of arguments if the declaration made by the passenger is verbal in nature, it must be brought into writing by the Customs Officer and so far as the application moved by the appellant to the Assistant Collector is concerned, it cannot be treated as a declaration, perhaps in view of these circumstances Mr. Hamid Shah Superintendent of Customs recommended for allowing the appellant to re-export the seized cloth. under section 142 ibid. His report is worth reading which is re-produced in verbatim as under:-

"An Indian National holding passport No.A.4251676 came to Lahore through PIA Flight No.PK.271 on 23-5-2000.

At the time of arrival he was directed to carry the luggage on conveyor belt for scanning which resulted in the recovery of 1190 yards of Indian origin cloth which is in commercial form. The passenger request for release of the cloth and its return vide his application is genuine and for that he may be allowed to take back the goods to India because the fact and circumstances available show that he had. not attempted illegal clearance. His goods detected through scanning machine were allegedly attempted for clearance in violation of law.

However, his contention sound plausible that due to communication gap and misunderstanding he placed his goods on conveyor belt for scanning and these goods were held' to be tainted one. In the present condition and overall facts and circumstances of the case his goods may be allowed re-export under section 142 of the Customs Act 1969."

8. It is obvious that in this report no strength was provided to the allegation of misdeclaration but the contention of appellant was recommended to be sound and plausible as the incident happened due to communication gap and misunderstanding when the appellant placed his goods on conveyor belt for scanning. This report is worth reliance because no counter evidence has been brought on the record by the prosecution to contradict this report therefore, it is to be believed that the appellant made no declaration before the customs officer. Meaning thereby we are of the affirm view that the impugned order cannot sustain in the eye of law. ??????????? .

9. In view of the discussion above impugned order dated 30-6-2000 is set aside, resultantly the cloth recovered from the appellant shall be returned to him for taking away back to India or if same is to be utilized in Pakistan then certainly subject to payment of customs and other duties as required under the law.

10. The appeal is hereby accepted.

C.M.A./529/Tax(Trib.) ???????????????????????????????????????????????????????????? Appeal accepted.