Zimbabwe Revenue Authority v Trustus (Pvt) Ltd (820 of 2022) [2022] ZWHHC 820 (16 November 2022)

1 HH 820-22 CIV ‘A’ 8/22 ZIMBABWE REVENUE AUTHORITY versus TRUSTUS (PVT) LTD HIGH COURT OF ZIMBABWE TSANGA & MAXWELL JJ HARARE, 24 May & 16 November 2022 Civil Appeal Mukucha, for the appellant Chiromo, for the respondent MAXWELL J:This is an appeal against the judgment of the Magistrates Court sitting at Beitbridge in case number CIV BTB 90/21 handed down on 10 January, 2022. Background Sometime in April 2021 Respondent’s truck with registration number AEU 1090(the truck) was seized by the Appellant whilst in Dulibadzimu suburb, Beitbridge. Respondent was advised that on the day of the seizure the truck had been abandoned by a driver after being hired to carry goods from a breakdown truck in Beitbridge. The driver had no authority from the respondent who believed the truck was parked in Harare. Respondent was advised by the Appellant to pay a fine of ZW$800 000.00 together with storage fees after various representations were made to have the truck released unconditionally. Respondent approached the lower court seeking an order for the unconditional release of the truck. It proved that it was the owner of the truck by tendering its registration book and averred that it did not take part in the commission of the offence leading to the seizure of the truck. Appellant opposed the application raising a point in limine that the application had prescribed and that Respondent had not complied with section 196(1) of the Customs and Excise Act [Chapter 23:02] (the Act). The said section requires that notice of pending civil proceedings be given in terms of the State Liabilities Act [Chapter 8:15]. On the merits, it stated that the truck was intercepted loading foreign goods with no clearance documents. It further stated that the truck HH 820-22 CIV ‘A’ 8/22 could not be driven due to a mechanical fault and was towed to Manica shed, and that one Mwakudza Joseph (Joseph) had come 5 days later claiming to be the owner of the truck. Appellant put in issue whether the respondent is the owner of the truck and submitted that the application was frivolous and vexatious and should be dismissed with costs on a higher scale. Judgment of the Court a Quo The lower court considered the points raised in limine. It was of the view that the wording of s 193(12) of the Customs and Excise Act is very clear that the time frame does not refer to the proceedings before the court. It stated that subsections (a) and (b) relate to the actions ought to be done by the Commissioner General and not by the court. It further stated that s 196(2) guides the time frame for court proceedings. The lower court was of the view that the issue of non- compliance with s 196(1) of the Act was not relevant and respondent was intending to frustrate the applicant by raising non-issues. The lower court dismissed both points in limine. On the merits of the matter, the lower court held that the applicant had shown, on a balance of probabilities, that he was not aware that the vehicle was being used to commit an offence. It accordingly ordered the release of the vehicle unconditionally. Grounds of Appeal Appellant was aggrieved and noted an appeal on the following grounds; - 1. The learned Magistrate in the court a quo erred in law by ruling that the Respondent’s claim had not prescribed when in fact the claim had prescribed in terms of s 193(12) of the Customs and Excise Act [Chapter 23.02]. 2. The learned Magistrate in the court a quo erred in fact and law by ruling that the respondent had issued a valid Notice of Intention to Sue the Appellant in terms of section 196 of the Customs and Excise Act [Chapter 23.02] as read together with the State Liabilities Act when in actual fact the said notice did not meet the requirements prescribed under section 6 of the State Liabilities Act. 3. The learned Magistrate grossly erred and misdirected herself on the law in ordering the release of the respondent’s seized vehicle even though the Respondent failed to satisfy the fact that it was not aware that the vehicle will be used to commit an offense as required under sections 187 and 188(2a) of the Customs and Excise Act [Chapter 23:02]. 4. The learned Magistrate in the court a quo grossly erred on a point of law by ruling that section 193(12) of the Customs and Excise Act [Chapter 23:02] regulate (sic) internal remedies within the Appellant’s administrative structures when in actual fact the same provisions (sic) relates to court proceedings. 5. The learned Magistrate grossly erred and misdirected herself on facts and law by concluding that the respondent was the owner of the vehicle seized by the appellant, when HH 820-22 CIV ‘A’ 8/22 in actual fact another person one Mwakudza Joseph also claimed ownership of the same vehicle. Appellant prayed for the setting aside of the judgment of the court a quo and its substitution with an order dismissing with costs the application for the unconditional release of respondent’s vehicle. Submissions by the Appellant Appellant’s heads of argument set out the prescriptive periods within which a claim for the release of seized goods must be instituted. Reference was made to s 193(12) of the Act which states that proceedings for the recovery of goods seized by the Commissioner or request of payment of compensation by the Commissioner must be instituted within three months of the notice of seizure being given or the publication thereof. Appellant referred to cases in which the defence of prescription was upheld. It stated that the truck was seized in April 2021 and the application was filed in December 2021 way after the lapse of three months. It further stated that the fact that respondent was pursuing appeals procedures available administratively was not a bar to approaching the court. In support of that submission, appellant referred to Twotap Logistics (Private) Limites v Zimbabwe Revenue Authority HH 207/17 and White Shadow Investments (Private) Limited v Zimbabwe Revenue Authority HH 683/21. It pointed out that the Supreme Court had dismissed an appeal by White Shadow Investments (Pvt) Ltd in SC 486/21. Appellant submitted that the notice of intention to sue issued by the respondent failed to meet the express requirements of the State Liabilities Act [Chapter 8:15] as it did not set out the grounds of the claim. Appellant also submitted that the notice was not served on it as no proof of service was tendered. It referred to Machacha v Zimra HB 186/11 in which it was stated that the primary objective of the provision was to give opportunity to appellant to investigate the material facts upon which its actions are challenged and to afford it opportunity to take corrective action if needed. It also referred to Ebrahim v Controller of Customs and Excise 1985 (@) ZLR 1 in which it was highlighted that in considering whether a letter is adequate as notice, the letter is viewed in the light of the objective of the requirement for notice. Appellant further submitted that respondent failed to discharge the burden of proving that it was not aware that its vehicle was going to be used to commit a crime and therefore the lower court was wrong in ordering its release. Appellant further submitted that the lower court was HH 820-22 CIV ‘A’ 8/22 wrong in finding that s 193(12) regulates internal remedies as the provision is clear that it deals with legal proceedings that must be instituted for the recovery of seized items pursuant to a notice of seizure. It also submitted that s 196 relates to any other claims not originating from a notice of seizure. Appellant prayed for the success of the appeal and the setting aside of the judgment of the lower court with costs. Submissions by the Respondent In response respondent made reference to s 196(12) of the Act which puts the period of prescription for civil proceedings or anything done by the Commissioner at eight months. It argued that s 193(12) deals with administrative proceedings whereby one makes representations to the Appellant before instituting civil proceedings in a court of law. It pointed out that the cause of action arose when Appellant’s Commissioner General made his final decision on 26 October 2021. Respondent argued that s 193(12) ought to be interpreted within the provision of s 196 and the principle generalia specialibus non derogant applies, that is to say, for the purpose of interpretation of two sections in apparent conflict, the provisions of a general section must yield to those of a specific meaning. It argued that since s 196 specifically refers to civil proceedings it prevails. Respondent referred to Bon Espoir (Pvt) Ltd v Hearing Chabata & Ors SC45/03 in support of that submission. Respondent pointed out that s 193(12) is not peremptory as evidenced by the use of the word “may” whereas in s 196(2) the word “shall” is used. Also that as stated in Air Duct Fabricators (Pvt) Ltd v A. M. Machado and Sons (Pvt) Ltd HH 54/16, “may” implies permissiveness, as in a discretion or a choice while “shall” is an imperative, a duty or obligation to take the prescribed course of action. Respondent argued that the notice to institute civil proceedings issued through a letter dated 4 September 2021 is valid as the State Liabilities Act [Chapter 8:15] is silent as to the format of the grounds of the notice. It referred to s 6(3) of the State Liabilities Act [Chapter 8:15] which authorizes the court to condone non-compliance where there is substantial compliance or where the non-compliance will not unduly prejudice the defendant. Respondent further argued that it is the owner of the truck in question and appellant has not challenged that position. Further, that it cannot be held liable in terms of the Act as it has neither committed an offence nor authorized its vehicle to be illegally used. It referred to the case of Chamu Ndaza v Zimbabwe Revenue Authority HH 79/2004 in which it was stated that ss 187 and 188 of the Act do not create a strict liability HH 820-22 CIV ‘A’ 8/22 offence and that it must be established that there was intention or culpa on the part of the owner for liability to attach. Respondent prayed for the unconditional release of its truck. Analysis Ground One The lower court was of the view that the period of three months within which action must be taken for the recovery or release of goods that would have been seized by appellant relate to actions to be done before the Commissioner General, and not the court. The issue of whether or not the application is prescribed must be considered in the context of the statutory provisions. Those provisions show three distinct stages in how goods subject to forfeiture are handled and how the owner of such goods can seek recourse. The first stage is provided for in subsection 10 of s 193 of the Act, which states; - “(10) Subject to subsection (11), whenever articles are seized in terms of this section the officer so seizing shall give to the person from whom the articles have been seized or the owner of the articles a notice in writing specifying the articles which have been seized and informing such person of the provisions of subsection (12).” The person from whom articles are seized or the owner of the articles is notified. In casu, the notice is Annexure A on p 45 of the record. The second stage is provided for in subsection 12 of the same section. Subsection 12 is worded as follows;- “(12) Subject to section one hundred and ninety-six, the person from whom the articles have been seized or the owner thereof may institute proceedings for— (a) the recovery of any articles which have not been released from seizure by the Commissioner in terms of paragraph (a) of subsection (6); or (b) the payment of compensation by the Commissioner in respect of any articles which have been dealt with in terms of the proviso to subsection (6); within three months of the notice being given or published in terms of subsection (11), after which period no such proceedings may be instituted.” The third stage is in s 196 which provides as follows; - “196 Notice of action to be given to officer (1) No civil proceedings shall be instituted against the State, the Commissioner or an officer for anything done or omitted to be done by the Commissioner or an officer under this Act or any other law relating to customs and excise until sixty days after notice has been given in terms of the State Liabilities Act [Chapter 8:15]. (2) Subject to subsection (12) of section one hundred and ninety-three, any proceedings referred to in subsection (1) shall be brought within eight months after the cause thereof arose, and if the HH 820-22 CIV ‘A’ 8/22 plaintiff discontinues the action or if judgment is given against him, the defendant shall receive as costs full indemnity for all expenses incurred by him in or in respect of the action and shall have such remedy for the same as any defendant has in other cases where costs are given by law.” What is interesting is the definition of “Commissioner” in the interpretation section, s 2 of the Act. The interpretation is; - “ Commissioner” means— (a) the Commissioner in charge of the department of the Zimbabwe Revenue Authority which is de-clared in terms of the Revenue Authority Act [Chapter 23:11] to be responsible for assessing, collecting and enforcing the payment of duties in terms of this Act; or (b) the Commissioner-General of the Zimbabwe Revenue Authority, in relation to any function which he has been authorised under the Revenue Authority Act [Chapter 23:11] to exercise;” The Commissioner General is appointed in terms of s 19 of the Revenue Authority Act [Chapter 23:11]. He has supervisory authority over Commissioners of the departments of the Appellant. It appears that the “Commissioner” referred to in s 196 of the Act is the Commissioner General. This is because Appellant’s opposing affidavit in the lower court outlined the various stages that respondent went through seeking internal remedies. In para(s) 12 to 16 of the opposing affidavit, the steps are given as from the Regional Manager to the Commissioner of Customs and Excise and then to the Commissioner General. It is trite that where domestic remedies are capable of providing effective redress, a litigant should exhaust the domestic remedies before approaching the court unless there is a good reason for not doing so. It therefore follows that before an owner of goods that have been seized approaches the court seeking an order to compel the release of such goods, there must be a decision of the Commissioner General and that such decision ought to have been obtained within three months of the notice of seizure. The lower court’s finding on prescription can therefore not be impugned. In any event, as argued for respondent, s 193(12) of the Act refers to proceedings in general and uses the word “may” whilst in section 196 of the Act reference is made to civil proceedings and the word “shall” is used. The maxim generalia specialibus non derogant therefore applies. The maxim means that general provisions do not derogate from special provisions. In the case of R v Gwantshu 1931 EDL 29, at 31 GUTSCHE J said the following: “The general maxim is generalia specialibus non derogant. ‘When the Legislature has given attention to a separate subject and made provision for it, the presumption is that a subsequent general enactment is not intended to interfere with the special provision, unless it manifests that HH 820-22 CIV ‘A’ 8/22 intention very clearly. Each enactment must be construed in that respect according to its own subject matter and its own terms’, per LORD HOBHOUSE delivering the judgment of the Privy Council in Barker v Edger [1898] AC at p 754. … Having already given its attention to the particular subject and provided for it, the Legislature is reasonably presumed not to alter that special provision by a subsequent general enactment unless that intention be manifested in explicit language.” The converse is true. Where the legislature has provided for a particular subject in general terms, if a specific provision is subsequently made, it must be presumed that the legislature intended to alter the general provision. The application before the lower court, being civil proceedings, ought therefore to be instituted within eight months as provided for in s 196 of the Act. There is no merit in the first ground of appeal. Ground Two The question is whether or not the court a quo was correct in finding that the notice of intention to sue given by the Respondent was adequate. The lower court observed that appellant accepted that notice was given but argued that the notice was defective as it did not meet the requirements of s 6(2) of the State Liabilities Act [Chapter 8:15]. The said section provides that; “(2) A notice referred to in subsection (1)— (a) shall be given to each person upon whom the process relating to the claim is required to be served; and (b) shall set out the grounds of the claim; and (c) where the claim arises out of goods sold and delivered or services rendered, shall specify the date and place of the sale or rendering of the services and shall have attached copies of any relevant invoice and requisition, where available; and (d) where the claim is against or in respect of an act or omission of any officer or employee of the State, shall specify the name and official post, rank or number and place of employment or station of the officer or employee, if known.” In Machacha v Zimra (supra) the purpose for giving notice is stated as that appellant be given timely opportunity to know and investigate the material facts upon which its actions are challenged. The letter on pp 81-83 clearly outlines the reasons why respondent sought the release of its truck. That there is no specific indication that these are the grounds of the claim is a matter of form. Appellant did not state that any prejudice resulted from the manner in which the notice was couched. As submitted for respondent, where there is substantial compliance, the court can condone as s 6(3) of the State Liabilities Act [Chapter 8:15] allows that in the following terms; - HH 820-22 CIV ‘A’ 8/22 “(3) The court before which any proceedings referred to in subsection (1) are brought may condone any failure to comply with that subsection where the court is satisfied that there has been substantial compliance therewith or that the failure will not unduly prejudice the defendant.” There is therefore no basis for impugning the finding of the lower court on that issue. The second ground of appeal fails. Ground Three The lower court held that there was no evidence to rebut the evidence of the respondent given by its Managing Director who stated that he was not aware of what the vehicle was used for at the time it was seized and that he had not authorized such use. The respondent tendered the vehicle registration book to prove ownership. There was no challenge to that evidence. There was no evidence to prove that the registered owner of the vehicle was aware of what the vehicle was being used for at the time of its seizure or that it had authorized such use. Submissions for the Appellant mainly centered on the actions and statements of Joseph. However, it is apparent from the record that Joseph did not have authority to hire out the truck. The Managing Director for the respondent stated in the founding affidavit that neither he nor the respondent had authorized the use of the vehicle and that it was supposed to be parked in Harare. What seems to have happened is that Joseph authorized the use of the vehicle without the consent of the Respondent or the Managing Director. He confirmed this in his affidavit, Annexure C1. The fact that the Managing Director, in the founding affidavit, asked Joseph to proceed to Beitbridge and get full information as to how and why the truck was there confirms that he had not authorized its use. In the circumstances, the lower court cannot be faulted for concluding that the owner of the vehicle had not authorized its use at the time of seizure. This ground of appeal also fails. Ground Four In this ground of appeal, Appellant faults the lower court for ruling that s 193(12) of the Act regulates internal remedies within the appellant’s administrative structures. It argues that the provisions for that section relate to court proceedings. The finding of the lower court cannot be impugned for the reasons given in relation to the first ground of appeal. As stated above, s 193(12) HH 820-22 CIV ‘A’ 8/22 of the Act regulates proceedings up to the Commissioner General. There is no merit in this ground of appeal. Ground Five Appellant faults the lower court for concluding that the respondent was the owner of the vehicle in question when another person also claimed ownership of the same vehicle. This ground of appeal is related to the third ground of appeal. The lower court cannot be faulted for disregarding Joseph’s claim of ownership that he stated in a letter when he subsequently deposed to an affidavit confirming that the truck belongs to the respondent. Also as stated above, the registration certificate of the truck which reflects respondent as the owner was not put in issue. This ground of appeal also fails. DISPOSITION The appeal lacks merit. The following order is made. The appeal be and is hereby dismissed with costs. TSANGA J:………………………I AGREE Masawi and Partners, respondent’s legal practitioners.