Ace Distriparks (Private) Limited Vs. Goonawardana, Director General of Customs & Others(29.05.020)

Ace Distriparks (Private) Limited Vs. Dr. Neville Goonawardana Director General of Customs & Others [Case No. CA (Writ) 195/2012, decided on 29.05.2020] Download

Judgement by Janak De Silva J, N. Bandula Karunarathna J agreeing.

Sections 12, 44, 57, 59, 107,130 of the Customs Ordinance; Contraband goods; difference between “forfeiture” and “liable to forfeiture”; In “value of the goods” in Section 130, the “goods” means only the the goods in relation to which a customs violation has taken place and not to goods entered or packed with the goods in relation to which a customs violation occurred.

Quotes:

[I]issue to be determined by Court is whether sections 12, 44, 57, 59 and 107 of the Customs Ordinance covers other goods stored in the same container with the contraband.

[F]urther forfeiture amounting to treble the value of goods was made in terms of sections 12, 44, 57, 59 and 130 of the Customs Ordinance.

The contraband in issue is 507.15 Kgs. of sandalwood which was attempted to be exported in a container which inter alia contained other goods.

The issue for determination is whether sections 57, 59 and 130 of the Customs Ordinance provide for the imposition of treble the value of goods including other goods stored in the same container with the contraband.

‘I am prepared to concede that the draftsmen must be given credit for having intended the terms “forfeited” and “liable to forfeiture” to convey different meanings. If the goods are declared to be “forfeited” as opposed to “liable to forfeiture” on the happening of a given event, their owner is automatically and by operation of law divested of his property in the goods as soon as the event occurs. No adjudication declaring the forfeiture to have taken place is required to implement the automatic incident of forfeiture … A forfeiture of goods by operation of law would, of course, be of purely academic interest until the owner is in fact deprived of his property by some official intervention’ Palasamy Nadar v. Lanktree (51 N.L.R. 520 at 522) Gratiaen J.

‘Forfeiture of goods is one of the consequences of a breach of the provisions of the Customs Ordinance. Some of the sections provide that in the event of such breach the goods shall be forfeited e.g. Sections 34(1), 43, 44, 50, 50A (l)(b), 52, 55, 65, 75, 100A(2), 107, 107A(1), 107A(2), 121, 131 and 142. Section 57 provides thot in the absence of any explanation to the satisfaction of the Director General of Customs, the goods shall be forfeited. Sections 38 and 68 provide that the goods shall be liable to forfeiture”‘: Lanko Jathika Sarvodaya Shramadan Sangamaya v. Heengama Director General of Customs and Others (1993) 1 Sri L.R. 1 where Kulatunge J.

But in certain situations the Customs Ordinance envisages the forfeiture of other goods as well.

The word “entered” in section 57 of the Customs Ordinance in my view means included in the Bill of Entry or CusDec.

However, section 57 of the Customs Ordinance does not cover the imposition of a forfeiture amounting to treble the value of goods although it provides for the forfeiture of the goods in relation to which the violation of section 57 of the Customs Ordinance occurred as well as the forfeiture of all other goods which were entered or packed with them as well as the packages in which they were contained.

In contrast, section 59 of the Customs Ordinance deals with both the forfeiture of goods together with the means of conveyance and the imposition of treble the value of goods. The question is what is meant by “such goods” in relation to the imposition of treble the value of the goods.

In my view the drafters of the Customs Ordinance appear to have made a clear distinction between situations where they intended to encompass only the goods in relat ion to which a customs violation occurred compared to situations where all other goods entered or packed with them as well as the packages in which they were contained are brought into the equation. That to me appears to be the reason for section 57 of the Customs Ordinance to specifically refer to goods entered or packed with the goods in relation to which a customs violation occurred whereas section 59 only refers to “such goods”. Therefore, in my view section 59 of the Customs Ordinance does not allow the imposition of treble the value of goods in the instant matter to include all other goods entered or packed with the sandalwood.

Section 130 of the Customs Ordinance provides for the imposition of a forfeiture of, either one hundred thousand or treble the value of goods at the election of the Director-General of Customs. The subject matter of this section is goods which are prohibited or restricted for export.

The question is what is caught up within the words “value of the goods” in this section. Here again, for the same reasons set out above in relation to section 59 of the Customs Ordinance, I am of the view that it means only the goods in relation to which a customs violation took place and not to goods entered or packed with the goods in relation to which a customs violation occurred.

*Note: Editor’s interpolations in quotes are within square brackets. The paragraphs quoted may not be in the same sequence as in the judgement.