1991CLC390 (PLP)

"Surcharge on imported goods:‑There shall be levied and collected an additional customs duty as surcharge on the importation of the goods specified in the First Schedule to the Customs Act, 1969 (IV of 1969), at the rate of five per cent of the value of the said goods as determined under section 25 of the said Act: Provided that for the purposes of the Sales Tax Act, 1951 (III of 1951), the additional customs duty shall not constitute a part of the duty paid value.

2. The Federal Government, subject to such conditions, or restrictions, if any, as it thinks fit to impose, may, by notification in the official Gazette, exempt any goods imported into Pakistan, from the whole or any part of the additional customs duty leviable under subsection (1) and no exemption from payment of customs duty under the Customs Act, 1969, or any other law for the time being in force shall apply to the additional customs duty leviable under the said subsection." Further by section 5 of the Finance Act, 1985 Iqra surcharge on imported goods was levied in the following manner:‑

5. Igra surcharge on imported goody‑(1) There shall be levied and collected an additional customs duty as Iqra surcharge on the importation of the goods specified in the First Schedule to the Customs Act, 1969 (IV of 1969), at the rate of five per cent of the value of the said goods as determined under section 25 of the said Act: Provided that, for the purposes of the Sales Tax Act, 1951 (III of 1951), the additional customs duty shall not constitute a part of the duty paid value. (2) The Federal Government, subject to such conditions, limitations, or restrictions, if any, as it thinks fit to impose, may by notification in the official Gazette, exempt any goods, imported into Pakistan from the whole or any part of the additional customs duty leviable under subsection (1) and no exemption from payment of cutoms duty under the Customs Act, 1969, or any other law for the time being in force shall apply to the additional customs duty leviable under the said subsection." In Al‑Samrez's case (1986 S C M R 1917) it was held that any notification withdrawing any exemption or prescribing higher rate of duty cannot be given effect to in respect of imports which were arranged and finalised and vested interest had been created before the issuance of such notifications. Thereafter in order to obviate its effect section 31‑A was added in the Customs Act by Finance Act 1988 which reads as follows:‑ ~;;??????? "31‑A. Effective rate of duty.‑(1) Notwithstanding anything contained in any other law for the time being in force or any decision of any Court, for the purposes of section,, 30 and 31? the rate of duty applicable to any goods shall include any amount of duty imposed under section 18, section 2 of the Finance Ordinance, 1982 (XII of 1982), and section 5 of the Finance Act, 1985 (1 of 1985), and the anti‑dumping or countervailing duty imposed under the Import of Goods (Anti‑dumping and Countervailing Duties) Ordinance 1983 (111 of 1983), and the amount of duty that may have become payable in consequence of the withdrawal of the whole or any part of the exemption or concession from duty whether before or after the conclusion of a contract or agreement for the sale of such goods or opening of a letter of credit in respect thereof. (2) For the purpose of determining the value of any imported or exported goods the rate of exchange of which any foreign exchange is to be converted into Pakistan currency shall be rate of exchange in force: (a) in the case of goods referred to in clause (a) of section 30, on the date referred to in that clause; (b) in the case of goods referred to in clause (b) of the aforesaid section, on the date referred to in that clause; and (c) in the case of goods referred to in section 31, on the dates referred to in that section." Mr. Khalid M. lshaq's contention is that as all these additional duties have been incorporated in section 31‑A resort to section 2 of the Finance Ordinance, 1982 and section 5 of the Finance Act, 1985 reproduced above for the purposes of granting exemption need not be made. According to the learned counsel the exemption granted under section 19 shall apply and the aforestated provisions of Finance Ordinance, 1982 and Finance Act 1985 should not be looked into. Section 31‑A is not a charging section. It is merely a machinery section envisaging the manner in which the duty is to be calculated and in that process the levies made under the aforestated provisions have also been included. However, the additional customs duty and lqra Surcharge are to be calculated in accordance with provisions of Section 2 of the Finance Ordinance, 1982 and Section 5 of the Finance Act, 1985. They clearly provide that for the purposes of these duties and surcharges the Federal Government can by notification exempt any goods imported into Pakistan, from whole or any part of the duty leviable under these sections. They specifically exclude the applicability of section 19 of the Customs Act. Therefore, any exemptin granted under section 19 of the Customs Act will not be attracted while charging duty under section 2 of the Finance Ordinance, 1982, and section 5 of the Finance Act, 1985. The petitioner is therefore, not entitled to the relief claimed by it. Petitions are therefore, dismissed. H.B.T./G‑237/K????????????????????????????????????????????????????????????????????????????????? Petitions dismissed.