Chita Car Hire Limited v Zambia Revenue Authority (APPEAL NO. 48 OF 2003) [2005] ZMSC 60 (12 October 2005)

IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 48 OF 2003 HOLDEN AT KABWE (Civil Jurisdiction) BETWEEN: CHITA CAR HIRE LIMITED APPELLANT AND ZAMBIA REVENUE AUTHORITY RESPONDENT CORAM: SAKALA, C. J., MAMBILIMA AND SILOMBA, J. J. S. On the 5th November, 2003 and l 2th October, 2005 For the Appellant: Mr. J. Chashi, Muponda Chashi and Company. For the Respondent: Mr. Muuka, In house counsel. JUDGiv1ENT SILO MBA, J. S., delivered the judgment of the court. This is an appeal against the judgment of the High Court delivered at Lusaka on the 3rd of December, 2002. The action before the learned trial judge was begun by a writ of summons in which the appellant (then plaintiff) claimed US $15, 000, being the replacement value of a Nissan one tonner, which was wrongly seized by the respondent and auctioned while the appellant was awaiting customs clearance. Apart from interest, the appellant claimed damages for loss of business as well. The evidence that was laid before the learned trial judge came from the appellant. The respondent did not testify. The evidence of the appellant, through a Mr. James Kasanga Chungu, was that he bought the vehicle on the 1 z!h of June, 2000 and handed it J2 to Mr. Wagner Chilembo, a customs officer, pending the clearance of the vehicle by the Zambia Revenue Authority through its department of Customs and Excise. Mr. Chungu was issued with a receipt for goods held. Thereafter, Mr. Chungu was in constant touch with Customs officers on a daily basis. In the process, the vehicle was assessed for duty purposes but the appellant found the duty payable on the car to be excessive; he decided to appeal to have the duty reduced. As he awaited a response from the authorities, Mr. Yusuf Chirwa, who was dealing with the matter, informed Mr. Chungu that the car had been auctioned. Mr. Chungu immediately got in touch with Mr. Wagner Chilembo who expressed shock and ignorance at the news of the sale. The evidence of the appellant was that at no time did the respondent ever communicate to him that the car had been seized. As we have already pointed out, the respondent did not testify in the court below but it put in a defence and written submissions, which were duly considered by the learned trial judge in relation to the evidence of the appellant. According to the defence and submissions, the respondent raised what was appropriately disposed of as a preliminary objection or issue on a point of law. In the main, the preliminary issue was that the appellant's present suit was statute barred because he had failed to institute these proceedings within three months from the 14th of August, 2001 , the date the motor vehicle was sold by tender by the respondent in accordance with the law. The law the respondent relied on is found in Section 162, sub-sections (7), (8), (9) and (10), of the Customs and Excise Act, Chapter 322 of the Laws (hereafter to be referred to as "the Act"). After taking into account the provisions of the law and the submissions from both sides in relation to the preliminary issue, the learned trial judge J3 became of the view that there was no contravention of the law by the respondent following the publication of the Gazette Notice No. 279 of 2001 in which the appellant was deemed to have been served with the notice of seizure; that the failure by the appellant to institute an action within three months from date of seizure rendered the present action statute barred. In terms of his finding, the learned trial judge proceeded to dismiss the whole action as being statute barred. There was only one ground of appeal advanced by the appellant to the effect that the learned trial judge erred in law and fact by holding that the appellant's action was statute barred as it was not instituted within three (3) months of the gazette notice No. 279 of 2001. However, during the hearing of the appeal, Mr. Muuka rightly conceded that since the respondent did not serve the notice of seizure on the appellant, as per the requirement under Section 168 of the Act, the sale of the vehicle by auction became illegal. AJl in all, Mr. Muuka did not support the judgment of the trial court. The amount claimed as per the statement of claim was US $15,000. There was also a claim for loss of business for which there was no evidence adduced as conceded by Mr. Chashi. On the main claim, Mr. Chashi told the court that they were claiming US $15, 000 as there was no dispute on the value of the vehicle. On the other hand, Mr. Muuka told the court that the duty payable should be deducted from the amount claimed, that is, US $15, 000. Mr. Muuka did not push the matter any further and decided to leave it to the court to decide. We have considered the issue at hand and since there is no dispute that the value of the car was US $15, 000, the claim of the appellant is successful and to that extent the holding of the learned trial judge that the claim was statute barred is set aside. We also J4 hold that on importation of the vehicle, the landing cost of the vehicle was US $15, 000 for which the appellant is obliged to pay duty and VAT as prescribed by the law. The duty to be assessed must, in the first place, be adjusted against the sum of K9, 645, 200, which the respondent raised from the illegal auction of the vehicle as supported by the documentary evidence at pages 43 and 44 of the record. Should there still be any balance to be paid, it is that balance that will be knocked out from the amount of US $15, 000. The amount to be paid to the appellant, after certain adjustments are made, shall attract interest at the short-term deposit rate from the date of the writ to the date of judgment. Thereafter, the interest shall be the lending rate as fixed by the Bank of Zamb.ia. The appeal is allowed with costs to be borne by the respondent both in this court and in the court below. The costs are to be taxed in default of an agreement. E. L. Sakala, CHIEF JUSTICE. I. M. C. Mambilima, SUPREME COURT JUDGE . . . ~ . . S. S. Silomba, SUPREME COURT JUDGE.