Mark Opur v Darbar Enterprises Ltd (2004) N2528

• Jurisdiction: Papua New Guinea
• Judge: Gavara–Nanu J
• Judgment Date: 03 February 2004
• Citation: (2004) N2528
• Court: National Court
• Year: 2004
• Judgement Number: N2528

Full Title: Mark Opur v Darbar Enterprises Ltd (2004) N2528

National Court: Gavara–Nanu J

Judgment Delivered: 3 February 2004

1 CUSTOMS ACT (CH101)—Customs Regulations (Ch101), s26—Customs Act (Ch101), s1, s99, s129(2), s146, s153(g) and s176—Definition of 'owner' of goods—Requirement for the owner of goods to lodge entries—Altering bills of lading—Such alterations being made without the knowledge of Customs—Bills of lading inconsistent with cargo manifests—Duty disputed by the owner—Power of Comptroller of Customs to condemn goods dependent on the Comptroller advising the owner in writing to institute recovery proceedings—Power of the Comptroller to sell goods, where owner disputes and refuses to pay the duty under protest.

2 Commissioner General of Internal Revenue Commission v Douglas Properties Ltd (2002) N2192, Chief Collector of Taxes v TA Field Pty Ltd [1975] PNGLR 144, Stretton v Malika Holdings Pty Ltd [1998] VSCA 127 referred to

___________________________

N2528

PAPUA NEW GUINEA

[In the National Court of Justice]

BETWEEN:

Mark Opur

- Plaintiff -

AND:

Darbar Enterprises Ltd

- Defendant -

WAIGANI: GAVARA – NANU, J

2003: 31st March & 07th July

2004: 03rd February

CUSTOMS ACT, CHAPTER NO. 101 – Customs Regulations s.26 – Customs Act, ss. 1, 99, 129 (2), 146, 153(g) and 176 – Definition of ‘owner’ of goods – Requirement for the owner of goods to lodge entries – Altering bills of lading – Such alterations being made without the knowledge of Customs – Bills of lading inconsistent with cargo manifests – Duty disputed by the owner – Power of Comptroller of Customs to condemn goods dependent on the Comptroller advising the owner in writing to institute recovery proceedings – Power of the Comptroller to sell goods, where owner disputes and refuses to pay the duty under protest.

Cases cited :

Commissioner General of Internal Revenue Commission -v- Douglas

Properties Ltd – N.2192.

The Chief Collector of Taxes -v- T.A Field Pty Ltd [1975] PNGLR 144.

Other cases cited :

Stretton -v- Malika Holdings Pty Ltd [1998] VSCA. 127.

Counsel :

C. Korus for the plaintiff.

G. Koi for the defendant.

GAVARA-NANU, J: The plaintiff is seeking orders to condemn twelve vehicles which were imported by the defendant and seized by the Customs Division of the Internal Revenue Commission (hereinafter referred to as ‘the Customs’) in 2000, after entries for the twelve vehicles were not lodged within seven clear days from the date of the inwards report of the cargo ship which carried the vehicles, as required by s. 26 the Customs Regulations (Chapter No. 101).

The plaintiff’s application is made pursuant to s. 129 (2) of the Customs Act, (Chapter No. 101), (hereinafter referred to as ‘the Customs Act’).

The undisputed facts are stated here in brief compass. The defendant imported twelve vehicles in the middle of 2000 from Japan from the supplier called Japan Flame Co. Ltd. The vehicles were seized by the plaintiff through Customs. The seizure was because of the defendant’s failure to lodge the entries and furthermore, there were alterations done to the bills of lading which were found to be false.

Two seizure notices were issued to the defendant. The first notice was issued on 26th October, 2000, and the second notice was issued on 19th January, 2001.

No customs entries have hitherto been lodged by the defendant for the twelve vehicles. The import duty also has not been paid by the defendant. These facts are not disputed.

The plaintiff claims that the duty for all twelve vehicles is K65,142.60, but the defendant argued that the correct duty is K 49,508.38.

The defendant’s contention is that pursuant to the agreement it reached with the plaintiff on 7th December, 2000, the defendant was to pay K49,508.38 customs duty for the twelve vehicles, and the plaintiff would release the vehicles to it. It was submitted for the defendant that, on that same day, viz. 7th December, 2000, the plaintiff accepted K 35,000.00 in a bank cheque as down payment towards the agreed amount of K49,508.38, and the balance of K 14,508.38 was to be paid within seven days from that date. The defendant through its Managing Director told the Court that it later went to the plaintiff’s office to pay the remaining K14,508.38, within the agreed period but the plaintiff refused to accept the payment without any reasons being given. The defendant therefore submitted that the plaintiff must honour the agreement of 7th December, 2000, and accept K 49,508.38 as the duty for the twelve vehicles. The plaintiff has denied that there was such an agreement between them.

The plaintiff called two witnesses. They are Mr Steven Iramu, who is the Director of Southern Region in the Internal Revenue Commission (hereinafter referred to as ‘the IRC’) and Mr Steven Korea, who is the Acting Director of Evaluation also in the IRC.

The defendant called four witnesses. They are Mr Robin Roman, who is the Managing Director of the defendant, Mr Muktar Hussain, who is the Managing Director of Zia Enterprises Ltd, MR Subash Ghosh, who is the General Manager of the defendant and Mr Kalam Roman, who is the Managing Director of Happy Enterprises Ltd.

Mr Iramu told the Court that, the other reason why the vehicles were seized is that, the bills of lading were altered, which he said was in breach of s. 153 of the Customs Act. Such alterations involved the defendant’s name being changed as the consignee to the names of the other companies and individuals.

Mr Iramu said, the first payment of K 35,000.00 made by the defendant was returned to the defendant at its own request.

Mr Iramu also told the Court that there was also a request by the Department of Transport to the IRC, to withhold the vehicles pending the outcome of an investigation which was being done on the defendant by that Department, for importing vehicles without a license. The defendant was eventually charged, but the charge was dismissed on technical grounds.

The plaintiff argued that, the alterations to the bills of lading were illegal because the manifests for the vehicles were not altered. In other words, the alterations in the bills of lading did not correspond with the cargo manifests.

The plaintiff said that, the total value of the vehicles was reassessed with the assistance of the PNG Motors Traders Association, which resulted in the duty being put at K65,142.60.

The plaintiff argued that, the vehicles are owned by the defendant, because it is the importer. And Mr Iramu told the Court that, if there were changes in the ownership of the vehicles, the shipping agent had to be informed first so that the appropriate alterations could be made to the cargo manifests. Also, the Customs had to be made aware of such alterations. Here, those were not done. Mr Iramu said the bills of lading could not be amended without the Customs’ knowledge. And any alterations to the bills of lading had to be made before the goods arrived at the port of entry.

In this case, the alterations to the bills of lading were done after the goods had arrived.

Mr Iramu told the Court that, even if the entries had been lodged within the required time, the contents of such entries would have been false because of the changes in the bills of lading, which would have resulted in the acquittal process being affected, as the bills of lading would not have corresponded with the cargo manifests.

Mr Roman told the Court that, from the twelve vehicles, three were for Happy Enterprises Ltd, two were for Zia Enterprises Ltd, three were for Tauna Holdings Ltd, two were for Liner No. 43 Ltd and two were for two individuals, Huamir Rahad and Subash Ghosh. He said he ordered the vehicles because his company was asked by these companies and individuals to order the vehicles for them.

He said, under the agreement entered into between the defendant and Japan Flame Co. Ltd on 11th July, 2000, the defendant was to find PNG buyers for the vehicles on behalf of Japan Flame Co. Ltd. It was agreed that if the defendant found buyers in PNG, the defendant would receive 10 % commission on every vehicle sold.

Mr Roman said, after the execution of the agreement, the four companies and the two individuals paid total of K140,000.00 to him in down payments for the vehicles. He then paid K77,000.00 to Japan Flame Co. Ltd. And the order for the twelve vehicles was made on 19th...