LAHORE: In a significant ruling, the Customs department has secured a decision in its favour regarding upholding the confiscation of 60% of the seized goods that were found to be smuggled.
The case involved the seizure of 40,500 kg of assorted brands and foreign origin cloth from a godown. The departmental adjudicating authority had passed an order for outright confiscation of the seized goods. However, the tribunal permitted the release of the goods on payment of duty and taxes, which was challenged by the department through a reference application.
The appellate forum, in its ruling, held that the goods in question were smuggled, and the respondent had failed to provide any lawful defence against the charge of smuggling. The forum noted that the tribunal had failed to appreciate the law and passed the impugned judgment in a slipshod manner.
The appellate forum set aside the judgment passed by the ATIR to the extent of 60% of the foreign origin goods, which were admittedly smuggled. The forum restored the order of the adjudicating
authority, upholding the confiscation of the smuggled goods.
The release of smuggled goods (which stood confiscated) on payment of duty and taxes, and that too without any redemption of the said goods did not appear to be correct and supported by any provisions of law. Confiscation and redemption of seized goods is covered by SRO 181 of the Act, read with SRO 499 (1)/2009 dated 13.06.2009.
Moreover the FBR had also notified the goods in question as goods falling within the contemplation of SRO 2(s)(i) of the Act, vide SRO 566(1)/2005 dated 6.6.2005. Requirement to give option to pay fine in lieu of confiscation in respect of confiscated goods is not absolute and is subject to the Notification issued by FBR under SRO 181, and the order of the
tribunal for imposition of redemption fine in lieu of outright confiscation of smuggled goods was unlawful and in violation of SRO 181 of the Customs Act, 1969.
According to the tax experts, the ruling has significant implications for the Customs authorities and the trade community, emphasizing the need for strict adherence to Customs laws and regulations to prevent smuggling and ensure fair trade practices.
Copyright Business Recorder, 2025
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