Collector of Customs Vs Ms. Bashir Pipe etc

Form No: HCJD/C-121

ORDER SHEET

IN THE LAHORE HIGH COURT, LAHORE

JUDICIAL DEPARTMENT

Customs Reference No.29083/2025

Collector of Customs Vs. M/s Bashir Pipe Industries (Pvt.) Ltd. etc.

S. No. of Date of Order with signature of Judge, and that of parties or order/ order/ counsel, where necessary.

proceedings proceedings

15-09-2025 M/s Rana Muhammad Mehtab and Ch. Muhammad Awais Kamboh, Advocates for the applicants.

M/s Hashim Aslam Butt, Muhammad Irfan, Ahmad Yar Khan, Ch. Muzammil Kamboh, Mazhar Abbas Malik, Irfan Haider Goraya and Ms. Fatima Mahmood, Advocates for the respondents.

One of the questions of law i.e. the jurisdictional question raised by the applicant-department in this and the connected Customs Reference, as enumerated in Appendix- A annexed hereto, is whether, after the amendment introduced in Section 194C of the Customs Act, 1969 (the Act) through the Finance Act, 2024, a Single Member of the Customs Appellate Tribunal (the Tribunal) is vested with jurisdiction to decide an appeal.

2.The main argument advanced by the learned counsel for the applicant-department is that, prior to the Finance Act, 2024, Section 194C of the Act contained sub-sections (2) and (3A), which explicitly empowered the constitution of a Single Bench, however, the said sub-sections have been omitted by virtue of the Finance Act, 2024, and hence no such power remains in the statute to constitute a Single Bench. It is further contended that a textual distinction has been deliberately drawn in Section 194C of the Act between the use of the expressions “constituted” in sub-section (1) and “authorized” in sub section (4) of Section 194C ibid. Therefore, sub-section (4) cannot be read as an independent

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enabling provision but is merely ancillary in nature, and can only be invoked in a situation where a Bench consisting of two Members has already been constituted and one of the Members is not available, in which case the remaining Member is merely authorized to proceed with the matter. It is also argued that no rules have been framed under Section 194C(2) of the Act in terms of the amendment introduced through the Finance Act, 2024, which, according to the applicant, demonstrates the absence of legislative intent to empower a Single Bench under the present scheme of law.

3.The learned counsel for the respondents, on the other hand, controverts the above position, arguing that after the omission of sub-section (3A) and amendment of sub-section (2) of Section 194C of the Act, the exclusive jurisdiction vests in the Chairman of the Tribunal to constitute either a Single Bench or a Bench consisting of more Members, depending upon the circumstances of the case. He submits that the only statutory embargo is contained in sub-sections (3) and (4) of Section 194C of the Act, whereby matters involving pecuniary jurisdiction exceeding five million rupees are to be heard by a Special Bench consisting of two or more Members, while matters below that threshold may lawfully be heard by a Single Bench. He further emphasizes that no substantive distinction can be drawn between the expressions “constituted” and “authorized” as employed in Section 194C of the Act; rather, both expressions, when read contextually, convey the same purpose and must be construed harmoniously to advance the legislative intent. Therefore, sub-section (4) of Section 194C is an independent enabling provision, not contingent upon the prior constitution of a two Member Bench, and its exercise is not dependent upon the framing of rules under Section 194C(2) of the Act.

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4.We have heard the learned counsel for the parties on the above legal question. In order to appreciate the contentions of the respective parties and to record our opinion upon the legal issue, it would be appropriate to reproduce the relevant provisions of Section 194C of the Act, both prior to the amendment through the Finance Act, 2024, and after the amendment, which read as under: Before the Amendment i.e. After the Amendment up to 30.06.2024 i.e. from 01.07.2024 to date

194-C. Procedure of 194C. Procedure of Appellate Tribunal.- Appellate Tribunal.—

(1)The powers and functions (1) The powers and of the Appellate Tribunal may functions of the Appellate be exercised and discharged Tribunal may be exercised by Benches constituted by the and discharged by Chairman from amongst the Benches constituted by the members thereof. Chairman from amongst the members thereof.

(2)Subject to the provisions contained in sub- (2) Subject to the sections (3) and (4), a Bench provisions contained in shall consist of one judicial sub-sections (3) and (4), member and one technical the procedure of the member. Appellate Tribunal including constitution of

(3)Every appeal against a benches, case management decision or order [deciding a system, distribution of case involving duty, tax, cases and other matters penalty or fine exceeding five ancillary or incidental million rupees] shall be thereto shall be regulated heard by a Special Bench by the rules under this Act. constituted by the Chairman for hearing such appeals and (3) Every appeal such Bench shall consist of against a decision or not less than two members order deciding a case and shall include at least one involving duty, tax, judicial member and one penalty or fine exceeding technical member five million rupees shall be heard by a Special [Provided that the Chairman Bench for hearing such may, for reasons to be appeals and such Bench recorded in writing, shall consist of not less constitute Benches including than two members and shall include at least one

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special Benches consisting of judicial member and one — technical member:

(a)two or more technical members; or Provided that the

(b)two or more judicial Chairman may, for members: reasons to be recorded in writing, constitute (3A) Notwithstanding any- Benches including special thing contained in sub- Benches consisting of two sections (2) and (3), the or more – Chairman may constitute as (a) technical members; many Benches consisting of a or single member as he may (b) judicial members. deem necessary to hear such cases or class of cases as the (4) The Chairman or any Federal Government may, by other member of the order in writing, specify. Appellate Tribunal authorized in this behalf

(4)The Chairman or any by the Chairman may, other member of the sitting singly, dispose of Appellate Tribunal any case which has been authorized in this behalf by allotted to the bench of the Chairman may, sitting which he is a member singly, dispose of any case where,- which has been allotted to the (a) the value of the bench of which he is a goods confiscated member where- without option

(a)the value of the goods having been given to the confiscated without owner of the goods option having been to pay a fine in lieu given to the owner of of confiscation under the goods to pay a fine in section 181; or lieu of confiscation under section 181; or (b) In any disputed (b) [Omitted] case, the difference in (c) in any disputed case, duty or tax involved, or the difference in duty or tax the amount of fine or involved or the duty or penalty involved tax involved, or the does not exceed five amount of fine or million rupees.

penalty involved does not exceed [five] million rupees.]

(emphasis supplied)

5.Keeping the above referred provisions in juxtaposition, it becomes evident that prior to the amendment

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introduced through the Finance Act, 2024, under Section 194C(1) of the Customs Act, the powers and functions of the Tribunal were to be exercised and discharged by Benches constituted by the Chairman from amongst the Members thereof. Under sub-section (2), subject to sub-sections (3) and (4), a Bench was to consist of one Judicial Member and one Technical Member. Further, under sub-section (3A), notwithstanding anything contained in sub-section (2), the Chairman was empowered to constitute Benches consisting of a Single Member to hear such cases or class of cases as the Federal Government may specify in writing. Likewise, under sub-section (4), the Chairman, or any other Member of the Tribunal authorized in this behalf, could also sit singly and dispose of any case allotted to the Bench of which he was a Member, subject to the limitation that the case related either to the confiscation of goods without an option to pay fine in lieu thereof under Section 181 of the Act, or where the duty, tax, fine, or penalty involved did not exceed five million rupees.

6.After the amendment, sub-sections (2) and (3) of Section 194C have been restructured, and sub-section (3A) has altogether been omitted. However, the effect of such amendment is not to extinguish the concept of Single Member Benches. Sub-section (1) continues to empower the Chairman to constitute Benches, and the amended sub- section (2) does not impose any rigid requirement that every Bench must invariably comprise both a Judicial and a Technical Member. The only mandatory requirement is prescribed under the amended sub-section (3), which provides that every appeal involving duty, tax, penalty, or fine exceeding rupees five million shall be heard by a Special Bench consisting of not less than two Members, including at least one Judicial Member and one Technical Member. This

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in reverse means that if the pecuniary limit does not exceed the above threshold, the appeal can be heard by Single Member Bench.

7.Admittedly, in the instant cases, the amount of duty, tax, fine, or penalty involved does not exceed the threshold of five million rupees. Consequently, the contention that the substitution of sub-section (2) and the omission of sub- section (3A) have obliterated the jurisdiction to constitute Single Benches is misconceived. Sub-section (4) of Section 194C continues to operate as an independent enabling provision, which empowers the Chairman or any duly authorized Member to sit singly and hear cases allocated to the Bench, subject to pecuniary limits. This provision operates ex proprio vigore and is not contingent upon the existence or constitution of a two-Member Bench.

8.It is a settled canon of statutory interpretation that where the legislature intends to curtail or withdraw an existing jurisdiction, such intent must be manifested through express words or necessary implication. The mere omission of sub-section (3A) does not, by itself, extinguish the distinct jurisdiction already preserved under sub-section (4). Rather, the retention of sub-section (4) after the amendment demonstrates the legislative intent to preserve the jurisdiction of Single Benches within the specified pecuniary limits. The principle expressio unius est exclusio alterius does not apply in the present context because the legislature, while omitting sub-section (3A), consciously restructured sub-section (2) and retained sub-section (4) as a substantive and independent basis of jurisdiction.

9.In view of the foregoing discussion, the orders passed by the Single Member of the Tribunal, both in this and the connected matters, do not suffer from any jurisdictional infirmity. The preliminary question of law is thus answered

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in the affirmative, holding that Single Benches remain competent to adjudicate matters falling within the pecuniary limits of Section 194C of the Act.

10.Accordingly, these matters shall now be fixed for hearing on merits on 14.10.2025, along with the connected cases.

MALIK JAVID IQBAL WAINS ABID AZIZ SHEIKH

JUDGE JUDGE

Approved for reporting

JUDGE JUDGE

Arsalan*