ORDER SHEET
IN THE HIGH COURT OF SINDH, KARACHI
Suit No.1434 of 2015
____________________________________________________________
Order with signature of Judge
For hearing of CMA No.11114/15 (u/o 39 rule 1 & 2 CPC)
07.08.2015
M/s.Arshad Tayebaly and Amel Khan Kansi, advocate for plaintiff
………
The plaintiff has challenged the levy of Regulatory Duty which has been imposed at the rate of 15% on the tiles being imported from China. Learned counsel initially referred to SRO 482(I)/2009 dated 13th June, 2009, which is available at Page-187 of the court’s file. This Notification was issued in supersession of SRO 896(I)/2008 whereby the Federal Government levied regulatory duty on import of goods specified in Column No.3 of the Table under the PCT code of First Schedule to the Customs Act. Learned counsel pointed out the entry at Sr.No.10 which relates to 15% advalorem Regulatory Duty on tiles, cubes and other similar articles. Thereafter he pointed out Clause (c) of Para-2 of the same Notification in which it is provided that Regulatory Duty shall not be levied on the imports against the Customs Notifications issued under Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs). Thereafter, he pointed out Page-41 of the court’s file which is SRO 605(I)/2015 dated 30th June, 2015, through which SRO 482(I)/2009 was amended, consequently the entries in column (1), Sr.Nos.10, 11 and 14 and the entries relating thereto in column No.2, 3 and 4 were omitted. Learned counsel pointed out another SRO 601(I)/2015, available at Page-31, issued on the same day i.e., 30th June, 2015, through which after making amendments in the earlier SRO, the relaxation of regulatory duty was withdrawn and again 15% regulatory duty has been imposed on tiles, cubes and other similar articles. Learned counsel further contended that this controversy was also raised before learned Lahore High Court which declared the above SRO as ultra vires to the provisions of Section 18 of the Customs Act.
- : 2 : -
I have also visited Section 18 of the Customs Act which relates to the goods dutiable. In Subsection 3, it is provided that the Federal Government may, by notification in the official Gazette, levy, subject to such conditions, limitations or restrictions as it may deem fit to impose, a regulatory duty on all or any of the goods to be imported or exported. Though under Subsection 5, Federal Government may, by notification in the official Gazette, levy an additional customs-duty on such imported goods as are specified in the First Schedule, at a rate not exceeding to 25% of value of such goods as determined under section 25, provided that the cumulative incidence of customs-duties leviable under subsections 1, 3 and 5 shall not exceed the rates agreed to by the Federal Government under multilateral trade agreements. Learned counsel further argued that after the order of learned Lahore High Court, the taxpayers in Punjab are not paying any regulatory duty but in the Province of Sindh, discriminatory treatment is being made.
Mr. Qamarul Hasan, Standing Counsel, undertakes to file comments of the defendant No.1 and 2. Mr.Kashif Nazir is present alongwith Mr.Ilyas Ahsan, Appraising Officer (Legal) Customs, and he undertakes to file vakalatnama for the defendant No.3 and 5. Ms.Afsheen Aman also undertakes to file vakalatnama for the defendant No.4.
Learned counsel for the defendant No.3 and 5 argued that most crucial point in this case is whether agreement between Pakistan and China is bilateral or multilateral and if this controversy is resolved, the entire matter will be decided and so far as the order of Lahore High Court in the same issue is concerned, the learned counsel requests for time to go through the judgment and file written statement/counter affidavit. So far as the release of goods is concerned, he has no objection, if the goods are released subject to furnishing surety through Pay Order equivalent to differential amount of 15% regulatory duty with the Nazir of this court and other duties and taxes
- : 3 : -
will be paid to the customs authorities by the plaintiff. The learned counsel for the plaintiff agrees to deposit the amount of regulatory duty with the Nazir of this court through Pay Order and payment of custom duty and other taxes to the defendants. The amount of regularity duty as may be deposited by the plaintiff shall be invested by Nazir in some government profit bearing scheme subject to final outcome of the suit. Immediately upon deposit of the amount of regulatory duty and its certification/verification by the Nazir, the goods of the plaintiff shall be released by the defendants.
It is expected that the learned counsel for the defendants will file their written statements before the next date of hearing. All learned counsel agreed that issues of law may be framed and entire matter may be disposed of on the basis of available documents and arguments. By consent, the matter is adjourned to 28.08.2015 for filing written statements and counter affidavits, thereafter, a date may be fixed for the settlement of issues of law in view of the pleadings of the parties.
J U D G E
Ashraf