KARACHI: A two-member bench of the Sindh High Court (SHC) comprising Justice Muhammad Junaid Ghaffar & Justice Agha Faisal dismissed constitutional petition filed by M/s Ashfaq Brothers and others against issuing of show cause notices for recovery of duty and taxes in terms of Section 32(3) of the Customs Act, 1969, details judgment has been released on Feb 20, 2021.
According to the judgment, the counsel for Petitioner has impugned a Notice dated 10.04.2018, whereby, the Petitioner was directed to pay the alleged short levied amount of duty and taxes with further directions to appear for hearing. Learned Counsel for the Petitioners submits that the impugned Notice is a Demand Notice, through which without proper adjudication, an amount has been determined and Petitioners have been directed to deposit the said amount.
According to him without a show cause notice and an order thereof, no demand notice can be issued; hence the impugned notice is without lawful authority and jurisdiction. On the other hand, learned Counsel for the department has supported the impugned notice and submits that it also provided an opportunity of hearing.
After arguments, court passed an order and observes in its order that “we have heard both learned Counsel and perused the record, impugned notice dated 10.04.2018 reflects that it is though worded as a Demand Notice in the subject; but has been issued in terms of Section 32(3) of the Customs Act, 1969 and while confronting the Petitioner with directions to deposit the short paid amount of duty and taxes within seven (7) days, an opportunity has been provided to substantiate the claimed classification of the goods in question along with relevant catalog / literature and other documents.
Not only this, a hearing was also fixed on 16.04.2018 with further directions to appear in person or through an authorized representative to contest the matter and so also to file a reply to the said notice.
In our considered view, the 3 notice may not have been properly worded insofar as the Subject mentioned therein is concerned; however, this fulfills the requirements of a show cause notice required to be issued in terms of Section 32(3) of the Customs Act, 1969, which provides that where, by reason of any inadvertence, error or misconstruction, any duty, taxes or charge has not been levied or has been short-levied, the person liable to pay such amount on that account shall be served with a notice within three years of the relevant date requiring him to show cause why he should not pay the amount specified in the notice.
We do not see any illegality in the impugned notice and merely for the reason that the word “demand notice” has been mentioned therein, this would not make the notice as without jurisdiction or as contended a direct demand notice without a show cause notice and adjudication. In our view it retains the ingredients of a proper show cause notice as required to be issued in terms of s.32(3) of the Act; hence, no case is made out.
If this had been a mere demand notice without any opportunity of contesting the matter, then perhaps, the contention raised by the Petitioners Counsel would have been justified; as this by now is well settled; however, this is not the case in hand. An opportunity has been provided which the Petitioner may avail before the concerned department.
In view of hereinabove above facts and circumstances of this case, by means of a short order in the earlier part of the day, we had dismissed this petition and above are the reasons in support thereof”.
