Re Fong Thin Choo

• Jurisdiction: Singapore
• Judge: Chan Sek Keong J
• Judgment Date: 29 April 1991
• Neutral Citation: [1991] SGHC 54
• Docket Number: Originating Motion No 4 of 1989
• Date: 29 April 1991
• Year: 1991
• Published date: 19 September 2003
• Plaintiff Counsel: Spencer Gwee (Spencer Gwee & Co)
• Citation: [1991] SGHC 54
• Defendant Counsel: Jeffrey Chan and Tan Chee Meng
• Court: High Court (Singapore)
• Subject Matter: Director-General of Customs and Excise's discretionary power,reg 12(6) Customs Regulations 1979,Export,Dutiable goods,Jurisdiction of court to issue prohibition against government,Reasonableness,Remedies,Whether dutiable goods were exported,Revenue Law,s 18(2) Supreme Court of Judicature Act (Cap 322),Meaning of 'evidence',Whether decision was reasonably made on the evidence,Whether decision justified by evidence,Words and Phrases,Customs and excise,Prohibition,Precedent fact,Administrative Law,Ambit,Scope of regulation,'Satisfaction',Test as to amenability to prohibition,Whether tribunal exercising a public duty,Judicial review,ss 27 & 99 Customs Act (Cap 70),s 27 Government Proceedings Act (Cap 121),Establishment of precedent fact,'Evidence',Imposition of customs duty in relation to non-export of dutiable goods

Cur Adv Vult

This is an application in the name of one FTC, a director of Szetoh Import & Export Pte Ltd (`the company`) for an order of prohibition to prohibit the Director-General of Customs and Excise (`the DG`) from further proceeding to recover $130,241.30 `by deducting the said sum from the several bankers` guarantees, including No 15883347` which had been lodged by the said company with the Customs and Excise Department (`the Customs`) under s 99 of the Customs Act (Cap 70) (`the Act`) as security for payment of customs duties, taxes, fees, penalties and all other charges payable under the Act. For convenience, I shall hereafter refer to the company as `the applicants` as this application was taken out on their behalf.

The applicants have been carrying and continue to carry on the business of exporters and importers of general merchandise. In the course of their business, they had to provide security to the Customs to meet their liability for customs duty in respect of the goods they dealt in. During the period 1987-1988, they had provided security in the form of three bankers` guarantees totalling $410,000. In the course of these proceedings the guarantees expired and have been replaced by an irrevocable bankers` guarantee to meet any liability for customs duty payable to the DG.

On or about 12 December 1987, the applicants removed a large quantity of cigarettes (`the goods`) from a licensed warehouse and transported them to the port area of the Port of Singapore Authority for loading on board a vessel `MV Sempurna Sejati` (`the vessel`) for export. In compliance with regulations, the removal and transport of goods were approved and supervised by the Customs. But the loading of the goods on board the vessel was not supervised. What had happened to the goods is the bone of contention between the applicants and the Customs. In accordance with regulations, the applicants delivered to the Customs three outward declarations showing that the cigarettes had been loaded on board the vessel. The exporters named in two of the outward declarations were the applicants. The third outward declaration is the subject matter of another claim against another company.

Some months later, whilst in the course of reconciling outward declarations and ships` manifests supplied by shipowners or their agents, a customs officer discovered that the goods had not been entered in the manifest of the vessel supplied by a company called TTS who were agents of the vessel.

Following this discovery, the DG wrote to TTS on 11 June 1988 for an explanation of the discrepancy within two weeks. On 20 June 1988, TTS replied that for the `particular trip, no berth was being applied nor any instructions given for loading by the ship operators except some lubricating and motor oil ...`. On 7 July 1988, TTS sent a further reply that `the goods which were declared by the exporter was not loaded onto the said "Sempurna Sejati"`. The letter went on to say:

We conclude our answer is reliable because we had checked with the shipowners, operators and its crew-members with regards to the goods so declared which we were equally puzzled at sight of your letter of query! As explained earlier, our records obviously showed that no berth was being applied for loading nor any instructions given for loading, no shipping orders taken by the exporters for cargo shipments except some lubricating and motor oil which were loaded for ship-stores only.

On 21 July 1988, the DG wrote to the applicants and required that proof in the form of a mate`s receipt or outward bill of lading or other documentary evidence that the goods had been exported be submitted by 28 July 1988. On 3 August 1988, the applicants replied and asked for time to furnish the mate`s receipt as the shipowner was not in Singapore. On 19 August 1988, the applicants wrote to the DG and again asked for more time for the same reason.

In the meantime, on 22 July 1988, the DG forwarded to TTS a copy each of the Customs export permits which had been signed by one Kusmawanto as the chief officer of the vessel acknowledging the receipt of the goods on board the vessel. The time stated therein was 0900hrs. TTS replied on 28 July 1988 and reiterated that they did not know anything about the alleged shipment. The letter went on to say:

(b) We had interrogated Mr Kusmawanto whose rank is just an ordinary crew and not chief officer, after referring to your copies, who was very much puzzled on the acknowledgement. He said that he did not sign on the custom permits and he mentioned even if there is such cargoes received at the sea why would he want to sign knowing his limits as a crew and not an authorized person to receive the goods and especially in the presence of the master and the chief officer? In line with this, we had clarified with the shipowner, operators and the high rank crew-members who were very much surprised and claimed that they did not receive any goods at the sea (no berth was being applied for that voyage) and none of them has seen or acknowledged receipt for the goods.

On 13 September 1988, the DG wrote to the applicants that as they had not been able to produce evidence of export of the goods, they were required under reg 12(6) of the Customs Regulations 1979 to pay duty on the goods amounting to $130,241.30. The DG also offered to compound the offence for $2,000. On 19 September 1988, the applicants replied that they were still trying to contact the chief officer of the vessel. They, however, forwarded an undated document signed by one TKM, a Sibu businessman, certifying that he had on 15 September 1987 received the goods and had paid the sum of $146,940 as per Invoice 16974 and copies of the relative invoice and receipt. The said letter contains the following notation of one ASC JM, a customs officer, made on 23 September 1988 as follows: `The attached documents cannot be accepted as evidence that the goods were exported.`

On 23 September 1988, the solicitor for the applicants, SG, wrote to the DG reiterating his client`s stand that the goods had been exported and requesting that the investigation be dropped. The Customs continued with their investigations, the results of which were later disclosed in an affidavit filed in these proceedings. On 16 December 1988, the DG wrote to the applicants as follows:

Please treat my letter Customs C-2/8/Vol III/(44) dated 13 September 1988 as cancelled.

2 Investigations revealed that the 178 ctns of assorted cigarettes declared in the abovementioned two Customs outward declarations were not manifested and were never loaded onto MV Sempurna Sejati. You are therefore requested to pay customs duty amounting to S$130,241.30[cent ] on the 178 ctns of cigarettes.

3 Please pay up the said customs duty within ten days from the date of this letter; otherwise we may initiate action to invoke your bank guarantee lodged with this department.

On 23 December 1988, the applicants replied, through their solicitors, as follows:

We refer to your letter dated 16 December 1988 bearing abovementioned reference which was only received by our client on 22 December 1988 at 4.30pm.

We are instructed to reply as follows:

(1) Our client denies that the 178 cartons and 156 cartons of cigarettes were never loaded on board MV Sempurna Sejati.

We are instructed that there is not a scintillia of evidence to prove that the cigarettes were never loaded.

On the contrary the abovementioned three outward declarations 120799, 120800 and 120789 shows an acknowledgement by the chief officer that the cigarettes were place on board on 12 December 1988 at 9am.

On 19 September 1988, our client had tendered to your department a certification letter from the buyer in Muara (Brunei) evidencing that the cigarettes were in fact exported and received. Further on 12 December 1988 the abovementioned three permits were returned duly endorsed by the chief officer and accepted by the customs permit section.

On 23 September 1988, we had also written on behalf of our client (SG/ft/189/88/CL) reiterating our client`s explanation.

As the evidential burden is more than discharged by our client we are unable to understand how investigations reveal that the cigarettes were never loaded as alleged.

Our client had arranged for the shipment of the cigarettes through the shipowner whose firm is now located in Batam Island.

We are instructed that the agent Thai Tong Shipping are not giving a full picture in regard to this transaction. The alleged fact that the cigarettes were not manifested is no concern of our client.

Take notice that our client will be compelled to seek damages and other relief in court should you proceed to take action as indicated in para 3 of your letter. Should your department sue for the alleged duty leviable we have instructions to defend for the aforesaid reasons.

The DG replied on 28 December 1988 as follows:

Please refer to your letter dated 23 December 1988.

2 We are satisfied from our investigations that the 178 ctns [times ] 10 mille cigarettes vide the above two customs outward declarations were never loaded onto the vessel `Sempurna Sejati`.

3 Please advise your clients to pay to the Director-General of Customs & Excise the duty on 178 ctns [times ] 10 mille cigarettes amounting to a total of $130,241.30[cent ] by 4 January 1989.

4 If payment for the above duty recovery of $130,241.30[cent ] is not received by then, action will be taken forthwith to recover this sum from your banker`s guarantee lodged with this department without any further reference to you.

In view of the terms of the letter of 28 December 1988, the applicants, on 30 December 1988, took out an ex parte application for leave to apply for an order of prohibition in OM No 198/89. Notice of the application was given to the Attorney General in accordance with O 53 r 1(3). At the hearing on 3 January 1989 for leave, state counsel appeared and raised a...