Foreign Exchange Manual

2015 PTD 125 INLAND REVENUE APPELLATE TRIBUNAL OF PAKISTAN Judicial Precedent

Chap. VIForeign Currency Accounts

Under Private Foreign Currency Accounts Rules framed by the State Bank of Pakistan, any Pakistani national residing in or outside Pakistan, including those having dual nationality may operate bank account in foreign currency in any schedule bank and the said foreign currency account could be fed by remittances received from abroad travellers' cheques issued outside Pakistan, foreign currency notes and foreign exchange generated by encashment of securities issued by the Government of Pakistan

Said accounts were free from all foreign exchange restrictions; in other words, account holders had full freedom to operate on their accounts to the extent of the balance available in the accounts either for local payment in rupees or for remittance to any country and for any purpose or for withdrawal in the shape of foreign currency notes and travellers' cheques.

2014 CLD 975 ISLAMABAD Judicial Precedent

Chap. XXIII, Ss. 14, 9, 5 & 16Import Policy Order, 2013, S. 4Import Policy Order, 2009, PreambleConstitution of Pakistan, Art. 199Constitutional petitionImport of Sprinkler LorriesPayment for importsLetters of CreditPermission of State Bank of Pakistan required for revolving letters of creditAmendments to letters of creditScope

Petitioner under Import Policy Order, 2009 could import sprinkler lorries whereas under the new Import Policy Order, 2013 sprinkler lorries of specification of the petitioner could not be imported

Section 4 of the Import Policy Order, 2013 stated that the amendments made in the letter of credit would not affect imports made on basis of bill of lading or letters of credit established prior to date of new Import Policy Order, 2013

Contention of petitioner was that he had established the letter of credit for import prior date of promulgation of Import Policy Order, 2013 and the period of letter of credit was one year, so within the said year, he could import old lorries through the letter of credit that had been established prior to promulgation of Import Policy Order, 2013

Validity

Section 14 of Chapter XXIII the Foreign Exchange Manual, 2013 provided different types of "letters of credit", and the petitioner had in fact required establishment of a "revolving letter of credit"

Letter of credit, in the present case was one credit but with different drafts as different consignments were imported, but issuance of such letter of credit was not allowed under S.14 of Chapter of XXIII of the Foreign Exchange Manual, 2013 as the requirement for opening such letter of credit was that the petitioner submitted an application to the State Bank of Pakistan, and without permission of the State Bank of Pakistan, the petitioner's Bank could not open such a letter of credit, therefore, issuance of letter of credit to the petitioner was against law

No doubt that letter of credit could be established on providing letter of invoice, but then all consignments mentioned in the invoice were to be imported at one and the same time, which was not done in the present case

Consignments, if imported through different shipments, then either different invoice and different letters of credit were required, or in the alternate, prior approval of the State Bank of Pakistan was required

Amendment in the letter of credit was also not covered by law as under S. 9 of the Chapter XXIII, Foreign Exchange Manual, 2013 Bank could extend the letter of credit for period of 12 months but a new amount could be provided through an amendment to the letter of credit

Proposed amendment to the letter of credit in fact amounted to opening a fresh letter of credit without fresh invoice, which was tantamount to a fraud upon the law

Arguments of the petitioner, if accepted, would mean that the Import Policy Order, 2013 could never be implemented

Constitutional petition was dismissed, in circumstances.

1977 PLD 785 KARACHI-HIGH-COURT-SINDH Judicial Precedent

Chap. XVII, paras. 2 & 3-Petitioner a Non-I.A.T.A. travelling agent given permission by State Bank under para. 3 to submit cases of P. P2 & T.I. forms etc. for travels abroad-State Bank, held. could withdraw permission at any tire without assigning any reason and accordingly without notice to petitioner or affording him opportunity to show cause.