Wellington J.P. Rajapaksha & Others Vs. Jayatilleke, Director General of Customs & Others (08.06.2020)
Wellington J.P. Rajapaksha & Others Vs. Jayatilleke, Director General of Customs & Others [C. A. (Writ) 2014/2004 Decided on 08.06.2020]Download
Judgement by Janak De Silva J, N. Bandula Karunarathna J agreeing.
Scope of powers of DGC under Section 163 of the CO, whether he can set aside a forfeiture; Section 2 of CO;
Facts: The Petitioners, Customs officers challenge the order of the DGC (1st Respondent) who had set aside an order for forfeiture issued by an inquiring officer under Section 57 of the CO. Exporter Company (3rd Respondent) did not challenge the position of the customs officers in the inquiry and was agreeable to a settlement and moved that the case be summarily decided, and appealed that the goods be released on a minimum penalty to enable the company to minimize the loss. Company subsequently appealed to DGC, who set aside the order of forfeiture.
Cases referred to:
- Toyoto Lonka (Pvt) Ltd.,and Another v. Jayathilaka and Others (2009) 1 Sri.L.R. 276, referred to discuss the locus standii of the Petitioners.
- Navaratne v. Director-General of Customs and Others (2003) 3 Sri.LR. 310
- W. G. Chandrasena and Another v. Dr. Neville Gunawardena, Director-General of Customs and Others [s.c. Appeal 31/2016, s.C.M . 19.10.2018].
- Lanka Lathika Sarvodaya Shramadana Sangamaya v. Heengama Director General of Customs and Others (1993) 1 SrLL.R. 1 at 21
- [8angamuwa v. S. M. 1. Senaratne, Director General of Customs and Another (2000) 1 SrLL.R. 106.
- Jaward v. Director General of Customs and Others (2005) 2 SrLL.R. 219
Court must consider whether that order P9 [by DGC] is lawful or unlawful and not whether it is right or wrong. That is done by applying the accepted grounds for judicial review, namely, illegality, irrationality and procedural impropriety. The order made by the 2nd Respondent [Inquiring Officer] (P3) does not bear any seal of invalidity upon its forehead until and unless its validity is determined before a Court of law or a tribunal having the jurisdiction to do so. The 1st Respondent set it aside thereby affecting the interest of the Petitioners in terms of section 153 of the Customs Ordinance. Hence, the Petitioners have the required standing to make this application.
[A]ll that this Court must consider is whether the 1st Respondent’s order (P9) is lawful or unlawful.
In Navaratne v. Director-General of Customs and Others [(2003) 3 sri.l.R. 310], this Court held that the Director-General of Customs has the power to revise and/or set aside an order made by an inquiring officer. In that case, such a course of action was held to be lawful as the inquiring officer did not correctly apply the provision of section 47 of the Customs Ordinance to the established facts. The above statement was cited with approval by the Supreme Court in W. G. Chandrasena and Another v. Dr. Neville Gunawardena, Director-General of Customs and Others.
In Lanka Jathika Sarvadaya Shramadana Sangamaya v. Heengama Director General of Customs and Others [(1993) 1 SrLL.R. 1 at 21] Kulatunga J. held: “It is true that the application for mitigation [under Section 163] was subject to an unusual condition namely, without prejudice to the petitioner’s right to challenge in Court the forfeiture of the goods. It is unusual because a mitigation can be made on the assumption that the forfeiture is valid but unduly severe.”
[W]hen section 163 of the Customs Ordinance is invoked, the Director General of Customs can only mitigate a forfeiture or penalty if it is deemed such forfeiture or penalty is unduly severe. The validity of the forfeiture cannot be questioned.
[T]he 1st Respondent did not have power to set aside the order of forfeiture made by the 2nd Respondent and release the goods to the 3rd Respondent by resorting to section 2 of the Customs Ordinance
Section 163 of the Customs Ordinance is a special provision and supersedes the general application of section 2 of the Customs Ordinance.
[T]he 1st Respondent acted ultra vires.
*Note: Editor’s interpolations in quotes are within square brackets. The paragraphs quoted may not be in the same sequence as in the judgement.
Editor’s Comment: The power of DGC to invalidate an order of an Inquiring Officer (IO) is available under Section 163 of the CO where the DGC finds the order of the IO to be legally wrong. There is an option to mitigate an unduly severe forfeiture, when the DGC considers the order of the IO is legally valid. The DGC is not expected by law to legally validate what he reasonably perceives as an legally invalid order by mitigating such an order. He then can set it aside.