Quick Summary of the Case
An attempt to smuggle foreign currency is one of the most common disputes under Pakistan’s customs law. In August 2026, the Supreme Court of Pakistan gave a clear judgment on it. The case is Collector of Customs, Model Customs Collectorate, Islamabad v. Javed Iqbal Malik and another, Civil Petition No. 3837 of 2023. Justice Muhammad Shafi Siddiqui wrote the judgment.
The question was simple. A passenger had US$40,000 hidden in his jacket. He was stopped at the last security counter, before he boarded the plane. Was this only “preparation”, or was it already an attempt to smuggle foreign currency?
Case Details at a Glance
- Court: Supreme Court of Pakistan (Appellate Jurisdiction)
- Bench: Chief Justice Yahya Afridi, Justice Naeem Akhter Afghan, Justice Muhammad Shafi Siddiqui
- Date of hearing and judgment: 17.08.2026
- Law involved: Section 2(s) and section 139 of the Customs Act, 1969
- Result: Petition converted into appeal and allowed. Confiscation restored.
The Facts: What Happened at the Airport
The Journey Through the Airport
On 17.11.2017, the respondent was going to Sweden on Flight QR-633 from Benazir Bhutto International Airport, Islamabad. At that time, a State Bank of Pakistan notification (F.E.1/2015-SB dated 01.06.2015) allowed a passenger to carry only US$10,000 in cash out of Pakistan. Anything more needed a valid No Objection Certificate (NOC) from the State Bank.
Customs had received information that someone would try to take a large amount of foreign currency out on this flight. Their staff at the departure hall were alerted.
The respondent then passed through these points:
- Baggage declaration counter
- Customs baggage search counter
- ANF search counter
- FIA immigration counter
His luggage was checked. His boarding card was issued. His passport was stamped for exit. Then he reached the last ASF checking counter. His jacket was scanned, and US$40,000 was found in the inner pocket. ASF told Customs, and Customs seized the money.
He was arrested after a notice under section 171 of the Customs Act, 1969, and FIR No. 66/2017 was registered the same day.
From Confiscation to the Supreme Court
The case moved through four levels:
- Collector of Customs (Adjudication): Order-in-Original No. 42/2018 dated 26.04.2018 ordered outright confiscation of the currency.
- Customs Appellate Tribunal: On 05.09.2019, the Tribunal allowed the respondent’s appeal and set aside the confiscation.
- Islamabad High Court: In Customs Reference No. 04/2020, the High Court answered the reference in the negative on 10.08.2023. It said whether he tried to smuggle was a question of fact, and it could not interfere unless the finding was perverse or against the record.
- Supreme Court: The Collector of Customs filed a petition under Article 185(3) of the Constitution.
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The Core Legal Question: What Is an Attempt to Smuggle Foreign Currency?
The Supreme Court framed the issue in paragraph 7. Did the respondent’s conduct amount to an attempt to smuggle foreign currency out of Pakistan under section 2(s) of the Customs Act, 1969, even though the money was found at the last ASF counter, before he left?
To answer this, the Court first looked at the law itself.
What Section 2(s) of the Customs Act, 1969 Says
Section 2(s) defines “smuggle”. It means to bring into or take out of Pakistan certain goods in breach of a prohibition or restriction in force. The list of goods includes “currency”. The definition also “includes an attempt, abetment or connivance” of bringing in or taking out such goods.
So the law treats an attempt to smuggle foreign currency in the same way as the smuggling itself.
Currency Is Covered, But Not Every Possession Is Smuggling
The Court made a careful point. Currency is named in the section, but this does not mean that every possession or movement of foreign currency is smuggling. The act must be linked to a breach of some prohibition or restriction. In this case, that was the US$10,000 limit and the NOC requirement.
The Word “Attempt” Has No Definition
The Act does not define “attempt”. So the Court said the answer must come from the ordinary legal difference between intention, preparation and attempt. It also noted that the law does not require the prohibited movement to be completed. An attempt to smuggle foreign currency is enough.
Intention, Preparation, Attempt and Completion: The Four Stages
The Supreme Court relied on earlier judgments to explain how a crime develops. This part of the judgment is very useful for any lawyer who handles customs cases.
The Four Stages of an Offence
From Central Board of Revenue v. Khan Muhammad (PLD 1986 SC 192), the Court listed four stages:
- Intention: Not punishable by itself.
- Preparation: Usually not punishable, unless the law makes it an offence.
- Attempt: An act done with the intention to commit the offence, forming part of a series of acts which, if not interrupted, would lead to the offence.
- Completed act: The offence is finished.
The hard part is finding where preparation ends and an attempt to smuggle foreign currency begins. The Court said it depends on the facts of each case. An attempt act must be “immediately, and not merely remotely” connected with the offence. Also, the interruption does not have to come at the very last step.
Khan Muhammad’s Case: Domestic Flight, No Attempt
In Khan Muhammad, an Afghan national was stopped at Peshawar while going to board a domestic flight to Karachi. Foreign currency was found in his bag. His final plan was to travel abroad, but the flight he was boarding ended inside Pakistan. More steps were still needed before the money could leave the country.
The Supreme Court held that this was still preparation. It also said that if he had taken further steps to board a plane that would take him out of Pakistan with the money, “there might have been a case of an attempt.”
Asghar Ali’s Case: Mixed Question of Law and Fact
In Asghar Ali v. State (PLD 2003 SC 250), the Court said an attempt arises when, after intention and preparation, a deliberate overt act is done towards the offence. It called the question of whether conduct has crossed into attempt a mixed question of law and fact.
That case had two parts:
- Pakistani currency at the seashore: Holding Pakistani currency inside Pakistan is not banned. There was no positive proof of an overt act to take it out. Suspicion could not replace evidence. So it did not go beyond preparation.
- Foreign currency in secret cavities of a vehicle: This was treated separately and held to be an offence under section 156(1)(8) of the Customs Act. The Court also said that failure to explain lawful possession can lead to the presumption under section 187, but only after the prosecution first proves illegal possession and the explanation is considered.
Muhammad Jehangir’s Case: Ready for Boarding
The Court also mentioned Muhammad Jehangir v. Chairman CBR (1999 CLC 939). There, a passenger was found with foreign currency in the departure lounge of Karachi Airport, ready to board. In Asghar Ali, the Court said that in such a case, if the recovery had not happened, the offence of smuggling would have been complete.
Are you a lawyer or business owner dealing with a customs or foreign currency matter? The rules around attempt, declaration and confiscation are technical, and a small fact can change the result. Visit verdicttales for more case breakdowns you can use in real files, and speak to a qualified lawyer before you act.
How the Supreme Court Decided the Attempt to Smuggle Foreign Currency
Looking at the Whole Conduct
The Court said the respondent’s conduct must be judged as a whole, not by one single fact. The key question was whether, at the time of interception, his acts were close enough to the offence of taking the currency out of Pakistan.
The Court noted that he:
- Went through baggage declaration, Customs search, ANF search and FIA immigration
- Got his boarding card and exit stamp
- Was stopped only at the last ASF checking counter, after immigration
- Passed several points where he could have declared the money, but did not
No Mechanical Test
This is an important part. The Court clearly said that completing an airport formality is not, by itself, proof of an attempt to smuggle foreign currency. It also said that the test is not just about where the person was caught or how many counters he crossed. The real question is whether the acts were a deliberate step close enough to the prohibited taking-out of the currency.
The Court said the value of these facts lies in their cumulative effect. Together, they show that the respondent’s conduct was directed towards taking the currency out, and not a mere arrangement for a future journey.
Why This Case Was Different
The Court separated this case from the two earlier judgments:
- From Khan Muhammad: There, the flight was domestic, and more journeys and steps were needed. Here, the respondent had “embarked upon and substantially completed the process of international departure.”
- From Asghar Ali (Pakistani currency part): There, holding the currency inside Pakistan was not itself banned, and there was no positive evidence of an overt act. Here, carrying foreign currency above the limit through international departure was different, and the acts were much closer to the crime.
The Plea of Ignorance: “I Did Not Know About the NOC”
The Rule: Ignorance of Law Is No Excuse
The respondent said he did not know that carrying more than US$10,000 needed an NOC. The Court called this plea “too innocent.”
It used the maxim ignorantia juris non excusat, which means that not knowing the law is not a defence. The Court referred to Trio Industries (Pvt.) Limited v. Babu Sher (2026 SCMR 152) for the same principle.
His Own Background Made the Plea Weak
The Court also looked at who the respondent was. He was a dual national and had a history of frequent international travel. So the claim of complete ignorance could not be accepted without more.
The Court then made a stronger point. Even if he was truly unaware, that cannot change what he actually did. He chose to carry an amount four times the allowed limit through each stage of departure, up to the last security counter, without an NOC. The plea might matter for his state of mind, but it could not answer all the circumstances on record.
Section 139: The Duty to Declare
The Court added that section 139 of the Customs Act, 1969 requires a passenger carrying goods that are prohibited or restricted for export to declare them to the proper officer. He did not declare the money. This failure, along with the other facts, supported the finding of an attempt to smuggle foreign currency.
The Final Decision of the Supreme Court
The Court held that, taken together, the respondent’s conduct had gone beyond mere possession or preparation. It was directed towards taking foreign currency out of Pakistan in breach of the restriction. So he had made an attempt to smuggle foreign currency under section 2(s).
The Court then:
- Set aside the Islamabad High Court judgment dated 10.08.2023
- Set aside the Customs Appellate Tribunal judgment dated 05.09.2019
- Restored Order-in-Original No. 42/2018 dated 26.04.2018 (outright confiscation)
- Converted the petition into an appeal and allowed it
What This Judgment Means for Travellers
If you travel out of Pakistan with cash, this judgment sends a clear message. Do not treat the airport as a series of small tests where you can wait and see if someone finds the money. Under this ruling, once you have gone deep into the departure process with restricted foreign currency, and you have not declared it, you may be held to have made an attempt to smuggle foreign currency. You do not need to be on the plane.
Some practical points, based on the facts of this case:
- Check the foreign currency limit in Pakistan before you travel. In this case, the limit at the time was US$10,000, with a State Bank NOC needed above it. Rules can change, so confirm the current position.
- Declare at the first counter. The respondent passed several points where he could have declared.
- Do not hide cash on your body or in clothing. Here, the money was found in an inner jacket pocket.
- Do not rely on “I did not know.” The Court rejected it, especially for a frequent traveller.
What This Judgment Means for Lawyers
For lawyers who work on customs and foreign currency matters, this case gives useful points on how to argue an attempt to smuggle foreign currency.
The Question Is Not Purely Factual
The High Court treated the matter as a question of fact and refused to interfere. The Supreme Court set aside both lower decisions after applying the legal test of attempt to the facts. This is useful when you argue that a Tribunal misapplied the legal test, even where the facts are not disputed.
Proximity Is the Key Idea
Future arguments will focus on how close the conduct was to the prohibited act. The Court gave a helpful comparison: a domestic flight with further steps needed (Khan Muhammad), possession inside Pakistan that is not banned (Asghar Ali), and a passenger who has gone through immigration and reached the last checkpoint (this case).
Location Alone Will Not Decide It
Lawyers on both sides should note that the Court refused to make a mechanical rule. It did not say that passing immigration always means attempt. It looked at all facts together. So each file needs a careful timeline of what the passenger did and where.
Explanation and Evidence Still Matter
The respondent had produced a bank statement to explain the source of the money. The Court still held that the overall conduct pointed to an attempt to smuggle foreign currency. Source of funds does not answer the question of restriction and declaration.
Key Takeaways
- Foreign currency is named in section 2(s) of the Customs Act, 1969, but not every possession of it is smuggling.
- An attempt to smuggle foreign currency is included in the definition, and the offence need not be complete.
- The line between preparation and attempt depends on the facts and on how close the acts are to the prohibited act.
- Passing through immigration, getting a boarding card and exit stamp, and reaching the last security counter with undeclared restricted currency can amount to an attempt.
- Ignorance of the NOC requirement is not a defence, and it is weaker for a frequent traveller.
- Section 139 requires a passenger to declare restricted goods.
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FAQs About Attempt to Smuggle Foreign Currency in Pakistan
What is an attempt to smuggle foreign currency under Pakistani law?
The Customs Act, 1969 does not give a separate definition. Section 2(s) says “smuggle” includes an attempt to take goods, including currency, out of Pakistan in breach of a prohibition or restriction. The Supreme Court explained that an attempt to smuggle foreign currency is a deliberate act, done with the intention to commit the offence, that is closely connected to it and forms part of a series of acts that would lead to the offence if not interrupted.
Is possession of foreign currency in Pakistan illegal?
The Court said that the definition of smuggling does not make every possession or movement of foreign currency an act of smuggling. The issue is whether the conduct was directed towards taking the currency out of the country in breach of a restriction. In this case, the restriction was the US$10,000 limit without a State Bank NOC.
How much foreign currency could a passenger carry out of Pakistan in this case?
At the relevant time, the State Bank of Pakistan Notification No. F.E.1/2015-SB dated 01.06.2015 set the limit at US$10,000. Anything above that needed a valid NOC from the State Bank. The respondent carried US$40,000, four times the limit. Rules can change, so always confirm the current limit before travelling.
Does an attempt to smuggle foreign currency need the plane to take off?
No. Section 2(s) includes an attempt, so the offence does not have to be completed. The Supreme Court held that the respondent’s conduct was an attempt to smuggle foreign currency even though he was stopped at the last ASF counter, before boarding. It also said the interruption of an offence need not come at the second-last step.
Can I say I did not know about the NOC requirement?
The Court rejected this plea in the case. It called it “too innocent” and applied the rule that ignorance of law is no defence. It also noted that the respondent was a dual national who travelled often. The Court said that the plea may be relevant to state of mind, but it cannot alone answer the full set of circumstances.
Does passing immigration and getting a boarding card always mean an attempt?
No. The Court said there is no mechanical test. Completing airport formalities in isolation does not decide the matter. What matters is the cumulative effect of all facts and how close the conduct was to the prohibited taking-out of the currency. In this case, the respondent had passed customs, ANF and immigration checks, got a boarding card and exit stamp, and did not declare the money.
What did the Supreme Court decide about the High Court’s view that this was a question of fact?
The High Court had said whether the respondent made an attempt to smuggle foreign currency was mainly a question of fact and declined to interfere. The Supreme Court did not agree with the outcome. After applying the legal test of preparation versus attempt to the record, it set aside the High Court and Tribunal judgments and restored the Collector’s order of confiscation.
What is the difference between this case and Khan Muhammad’s case?
In Khan Muhammad, the passenger was stopped while boarding a domestic flight to Karachi, so further steps were needed before the currency could leave Pakistan. The Court held that was still preparation. In this case, the respondent had gone through the main international departure steps and was stopped at the last security checkpoint, which put him much closer to the prohibited act.
Does section 139 of the Customs Act apply to passengers?
Yes. The Court said section 139 requires a passenger carrying goods that are prohibited or restricted from being taken out of Pakistan to declare them to the proper officer. The respondent’s failure to declare the currency was treated as an important fact along with the others.
This post is for general information only and is not legal advice. For your own case, speak to a qualified lawyer.
