KARACHI: Any untrue declaration made by an importer not-withstanding the fact of same amount of duty and taxes, attract penal action, held a custom appellate bench of High Court of Sindh (SHC) while deciding a Special Custom Reference Application filed by Pakistan Customs against Khalid Impex, Lahore.

The applicant department raised nine questions of law in the said SCRA and later argued only two qiestions which are as under:

1) Whether the Tribunal erred in law by not considering the proposition of law that in terms of amended provision of law i.e. Sections 79(1) & 80 of the Customs Act, 1969, incorrect selfassessment resulting into loss of revenue is an 2 offence attracting the provisions of Section 32(1) & 32(2) of the Customs Act, 1969?

2) Whether on the facts & circumstances of the case the Appellate Tribunal erred in law to misinterpret the CGO 12/2022 and further erred in law to give preference/overriding effect of CGO (an administrative order) on a notification SRO 487(1)/2007 dated 09.-06.2007 (a Statutory Order).

As per details the Respondent importer electronically filed its Goods Declaration bearing CRN-874052 dated 10.01.2009 mentioning therein one sided coated duplex board with grey back, weighing 21695 kgs, at an invoice value of US$ 8687/- under HS Code 4810.9200. The said GD was however selected by the Department for scrutiny and upon examination; it revealed that the subject consignment was both sided coated duplex board of Manila Back, the value of which according to the Department was US$ 0.93 per kg as against declared value at US$ 0.490 per kg. A show cause notice dated 13.01.2009 was then issued for the alleged suppression of duty and tax amounting to Rs.482338/-, along-with imposition of applicable penalty/fine etc. Reply was then given by the Respondent, however the said reply was not found satisfactory by the Department.

Thereafter vide Order-in-Original No.4024/2009 dated 12.02.2009, the Respondent was directed to pay the above referred amount along-with applicable penalty/fine for mis-declaration of the description of the imported goods.

Being aggrieved with the said order an appeal was preferred before the Collector of Customs (Appeals) by the Respondent. The said Collector (Appeals) after hearing the matter, vide Order-in- 3 Appeal No.1645/2009 dated 14.3.2009, found that since the H.S Code and the applicable duty/taxes of the goods declared by the Respondent and assessed by the Department were the same and that there was no difference in the description of the goods, as declared by the Respondent and as assessed by the Department, waived the redemption fine and penalty by allowing the appeal.

Being aggrieved with the said order appeal was preferred by the Department before the CAT, who also affirmed the order of the Collector (Appeals), by observing that since there was no difference in the duty paid and the duty assessed by the Department and as the H.S Code of the goods description made by the Respondent and assessed by the Department were the same, hence no adverse inference could be drawn by the Department against the Respondent and affirmed the order of the Collector (Appeals) by observing that provisions of Section 32 of the Customs Act, 1969 (hereinafter referred to as the Act) were not attracted and that the Collector (Appeals) was justified in remitting the fine/penalty. It is against this order of the CAT that the present SCRA was filed by raising the above referred questions.

In our view a person is guilty of making untrue declaration of its goods, as specifically provided under Section 79 of the Act, 7 notwithstanding/irrespective of the fact that after final determination H.S Code and the rate of duty/taxes had remained the same and penal action in such circumstances is warranted for untrue declaration coupled with giving incorrect particular of such goods of the description of the goods.

The bench cited a decision given in the case of Collector of Customs vs Messrs BNN Enterprises (2022 PTD 1418) given by a bench of Sindh High Court, which observed as under:- “6. Insofar as the argument that since there was no difference of rate of duty under the claimed HS Code as against the assessment made by the Applicant, it would suffice to observe that this contention is wholly misconceived and reliance on Para 101 of CGO12 of 2002 in the given facts and circumstances of this case is misplaced. The same applies in cases, wherein, an importer claims assessment under certain HS Code which is not accepted and the assessment is made in some other HS Code by the department and if as a result thereof, there is no change in the rate of duty, then benefit of Para 101 of CGO 12 of 2002 can be claimed by an importer. In this case the facts are entirely different as an attempt has been made to declare goods as used as against new and as a consequence thereof, notwithstanding that the rate of duty remains same, an attempt had been made to pay duty and taxes on lower / reduced value of used goods as against the value of new goods. If this would have gone undetected, naturally lesser taxes and duties would have been paid on the value of used Road Roller as against the value of a new Road Roller. This apparently is a case of mis-declaration of actual description of goods warranting initiation of proceedings in terms of Section 32 of the Act and the benefit, if any, of Para 101 of CGO 12 of 2002 is not available in the facts and circumstances of the case. The respondent had made an attempt; but was unsuccessful, and therefore, the Tribunal has seriously erred in setting aside the order of Adjudicating Authority, whereby, goods were confiscated and redeemed against fine and penalty. The Adjudicating Authority has dealt with the issue in accordance with the legal provisions applicable in this case and the finding of the said authority did not warrant any interference by the Tribunal which is based on completely irrelevant appreciation of law which cannot be endorsed or sustained by this Court.” 8 11. In view of what has been discussed above, we answer the Questions No.4 & 8, referred to in the present Spl.CRA, in affirmative i.e. in favour of the Department and against the Respondent.