Law: Customs Act, 1969

Section: 32A,32,16,156(1)(9),156(1)(14A),156(1)(7 7)

Law: Imports and Exports (Control) Act, 1950

Section: 3

Customs Act (IV of 1969)-- -- Ss. 32A, 32, 16, 156(1)(9), 156(1)(14A) & 156(1)(77)--Imports and Exports (Control) Act (XXXIX of 1950), S. 3-Foreign Exchange Regulation Act (VII of 1947), S. 12--SRO No.266(I)/2001, dated: 07-05-2001--Fiscal fraud--False statement, error, etc-- Importation or exportation of restricted goods--Falsification of document--Powers to restrict imports and exports--Payment for exported goods--Scope--Appellants were alleged to have been involved in export of gold and jewelry against fake Form-E, therefore, foreign remittances were not received and as such withholding tax and Export Development Surcharge was not collected--Validity--Export of gemstones and jewelry at the relevant time was subject to special procedure provided under SRO No.266(I)/2001--Export was made in accordance with the procedure and hundreds of consignments were cleared by the Department after examination and weighment of goods during the relevant period--Apart from the allegations of fake Form-E, the show-cause notice and orders were silent regarding the goods actually exported and as to whether the exported goods were real gold jewelry or it was fake only to balance out Import of gold--Investigation was also silent in that respect--Department did not tally imports with exports to find out actual timing of alleged fraud--Time limit days was fixed In subsection (2) of S. 32A, Customs Act, 1969 in order to issue notice, as such the show-cause notice was barred by limitation--Department failed to justify its jurisdiction in the presence of special procedure governed by Trade Development Authority of Pakistan--Export Development Surcharge was to be collected by the State Bank of Pakistan or duly authorized bank at the time of realization of proceeds of export and the Customs Department was not the relevant agency under Foreign Exchange Regulation Act, 1947 Collection of withholding tax on realization of export proceeds was not the Customs Department's job--Matter could at the best have been resolved by invoking S.32(3) of Customs Act, 1969 which was missing in the show cause notice as well as original orders--Department opted an omnibus formula and levied penalty…

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