ISLAMABAD, Feb 21: The Supreme Court on Wednesday rejected the appeal of West Pakistan Tank Terminals, owned by Seth Sadruddin Ganji and his son Hashim Ganji seeking refund of Rs104 million “excess payment” as sales tax and duty on edible oil clandestinely removed by them from their warehouse in Karachi without filing bills of entry, paying leviable taxes and meeting other formalities.
A two-member bench of the Apex Court which upheld the decisions passed by Sindh High Court on September 19, 2006, judgment of the Customs Central Excise and Sales Tax Appellate Tribunal on May 23, 2006 and Collector Adjudication on December 19, 2000, comprised Justice Rana Baghwan Das and Justice Hamid Ali Mirza.
It was brought to the notice of the Court that 55 consignments comprising of 53,000 tons of oil had secretly been removed from West Pakistan Tank Terminals during 1993-96.
Former Deputy Attorney General and M. Bilal Advocate and Mr Mumtaz Sheikh appeared before the court on behalf of the Customs Department, Karachi. They were assisted by Customs Intelligence Officer Shabieh Haider and Law officer Taqi Mirza. The petitioner side was represented by Sibtain Fazli Advocate.
The court refused to grant leave to appeal with the observation that petitioners cannot ask for equitable relief when they had not come to the court with clean hands.
The customs department is yet to recover Rs57 million in duty and Rs50 million as personal penalty from Sadruddin Ganji and his son.
The Court held that out of over Rs530 million duty, an amount of 510 million had been paid by the appellants. The Court rejected the plea that the show-cause notice issued to them for the payment of evaded duties had become time barred. The Court observed that the consignments warehoused without payment of taxes and duties never become time barred unless the same were paid by the person concerned.
The Court said the question of limitation in issuance of show-cause notice would also not apply in this type of situation where the evader had entered into an agreement to pay the duty. The Court held that difference in duty along with personal penalty can be recovered.
The evasion of tax duty by leading businessman Sadruddin Ganji and his son Hashim Ganji was a big scam unearthed in 1996 by Director General Customs Intelligence Staff. Two Collectors had lost their jobs on the charges of conniving with them while others also faced penalties in light of the investigations and a subsequent admission by Mr Hashim Ganji about fraudulent removal of palm oil.
