OBEDULLAH And 2 Others vs INSPECTOR GENERAL, FRONTIER CORPS., QUETTA
This appeal for leave to appeal is directed against the judgment of the High Court of Baluchistan dismissing the petitioners' constitutional petition. The petitioners were intercepted while transporting Banaspati Ghee with the intention of smuggling it out of Pakistan, leading to the seizure of the goods by Kharan Rifles and subsequent confiscation by the Deputy Collector Customs. Upon appeal, the Collector Appeals granted the petitioners an option of redeeming the goods upon payment of a redemption fine, which the petitioners deposited. However, prior to the appellate decision, the perishable goods had already been auctioned by the department and the proceeds deposited in the Government Treasury. The core legal question was whether the original goods could be restored to the petitioners or whether the constitutional petition was rightly dismissed when physical restoration became impracticable. The Supreme Court held that since the goods had already been lawfully disposed of by auction before the remedy was sought, physical restoration was impossible and no implementation directions could be issued in a vacuum. The Court refused leave to appeal while noting the necessity for transparency and fair market value in departmental auctions.
- Can a court issue directions for the physical restoration of goods that have already been lawfully auctioned as perishable items during the pendency of proceedings?
- Whether a constitutional petition seeking the return of seized goods becomes infructuous when the goods are no longer available with the respondents?
- What is the obligation of customs authorities regarding transparency and obtaining fair market value during the auction of seized perishable commodities?
- Section 181, Customs Act 1969
MUNAWAR AHMAD MIRZA, J.---This appeal for leave to appeal is directed against the judgment dated 9-12-1996 passed by learned Division Bench of High Court of Baluchistan, Quetta, in Constitution Petition No.369 of 1996.
2. Relevant facts precisely mentioned are that on 17-10-1994 at about 11:30 p.m. Personnel of Kharan Rifles while on Gusht intercepted three passenger buses wherein petitioners were found transporting ' Banaspati Ghee' consisting of following details in terms of quantity and weight besides other goods from Quetta to Taftan with intention of smuggling the same out of Pakistan:- S.No.Name of Claimant Description of Goods Quantity
1. Abdul Manan (i) Ghee (16 Kgs each)
(ii) " (5 K gs each) (iii) " (2.5 500 Kgs)16 tins.
135 "
70 "
2. Obedullah s/o Sh Noor Muhammad & Abdul Qadir(i) Ghee
(ii) ---100 --- 77 --- Accordingly above described Banaspati Ghee and goods were seized and matter forwarded to Customs Authorities.
3. It may be seen that on 4-12-1994 show-cause notice was displayed on the notice board and petitioners in response appeared and claimed return of said commodity. Eventually Deputy Collector Customs, Quetta, vide judgment dated 8th August, 1995, passed in Case File No.V-8(749)
Cus/DC(FC)/94/19050, held that charges regarding smuggling of said Ghee out of country were established; therefore he ordered confiscation of said goods.
4. Petitioners challenged above decision before Collector Appeals (Western Zone) Central Excise and Sales Tax, Karachi, by way of Appeal No.AC/318(Q)/95/1220. The appeal was dismissed on 24- 10-1995, however, an option was given to the petitioners under the provisions of section 181 of Customs Act to redeem the goods subject to payment of redemption fine equal to 50% of its value.
Consequently petitioners exercising the option for redemption of 'Banaspati Ghee' deposited requisite fine on 12-2-1996. Deputy Collector Customs on 24-3-1996 issued a letter to respondent No.2 (Commandant Kharan Rifles) for releasing aforementioned quantity of Banaspati Ghee to the petitioners.
5. It is the case of petitioners that thereafter they repeatedly approached respondent No.2 for the restoration of 'Banaspati Ghee' in compliance with decision of adjudicating authority, but with no practical relief.
6. Thus feeling aggrieved petitioners challenged action of respondent through Constitution Petition No.369 of 1996 before High Court of Baluchistan, Quetta, which was dismissed in limine, vide judgment dated 9-12-1996. During the pendency of petition, it revealed that department had factually auctioned (Banaspati Ghee) on 7-6-1995, on account of being perishable; and sale proceed amounting to Rs.12,889 were deposited in Government Treasury. It was conceded before the High Court by respondent that petitioners were entitled to receive the auction price lying deposited in Government Treasury.
The above decision of High Court dismissing Constitution Petition has been challenged by petitioners before this Court through present petition for leave to appeal.
7. Mr. Sardar Muhammad Durrani, Advocate Supreme Court, appearing for petitioners argued that Collector of Appeals heard the matter on 28-8-1995, but intimation regarding auction of 'Banaspati Ghee' on 7-6-1995 was not communicated. According to learned counsel concealment of important fact which was subject matter of adjudication clearly smells of mala fides. It was emphatically urged that respondents were bound to execute and implement order of Collector Appeals, passed in lawful exercise of authority vested in him, and failure to carry out the same tends to contravene fundamental constitutional right of the petitioners.
8. Mr. M.S. Rakhshani, learned Deputy Attorney General, was present on Court notice. He vehemently opposed the petition on the ground of being incompetent. Learned Deputy Attorney General submitted that 'Banaspati Ghee' seized from petitioners has already been sold, however.
Department was willing to return either amount of sale proceeds being Rs.12,889 or amount of redemption fine deposited by petitioners with Collectorate of Customs, Quetta, at their option towards implementation of order passed by Collector Appeals.
9. We have perused the record and considered above arguments. Evidently 'Banaspati Ghee' seized from petitioners on 17-10-1994 was sold through auction on 7-6-1995. Sale proceeds amounting to Rs.12,889 were deposited in Government Treasury. It is thus quite apparent that goods (Banaspati Ghee) had already been disposed of before petitioners could seek remedy before High Court. In view of abovereferred development, obviously it has become impracticable to restore original goods (Banaspati Ghee) to petitioners. Conclusions drawn in the impugned judgment by learned Division Bench of High Court, therefore, do not suffer from any material defect or legal infirmity.
10. However, it is disturbing to note that adjudicating authority by acting negligently has caused unnecessary confusion. We feel that authority vested with quasi-judicial authority connected with adjudication or determination of 8 entitlement must be vigilant and cautious while exercising their powers/jurisdiction. It appears that Collector Appeals was completely oblivious of factual aspect and had decided the matter without properly scrutinising the case file which cannot be appreciated.
11. It is quite manifest now, that goods (Banaspati Ghee) having been auctioned are not available with respondents. Therefore, no directions can be issued in vacuum or which may be incapable of implementation. In the peculiar circumstances, persistence of learned counsels for restoration of 'Banaspati Ghee' does not appear to be reasonable. We may observe that normally there is considerable demand of 'Banaspati Ghee' everywhere. Therefore, it is not understandable why during auction said commodity has fetched low price. The authorities are bound to ensure that auction proceedings are transparent, and invariably procure price fairly closer to market value. The competent authority in Customs Department is required to adopt adequate measures for obtaining better results so that consequential legal right or benefits accruing from such auction proceedings to either party is not jeopardized.
12. Since relief claimed by petitioners could not be granted by the High Court on account of obvious reasons, therefore, petition was rightly dismissed. Accordingly we do not find any merits in this petition. Leave is, therefore, refused.