KARACHI: In case of dispute over valuation of imported consignment, “it is mandated upon the authority (Custom authorities) defined under section 81 are bound to allow the clearance of the consignment under the provisions of section 81 of the Customs Act 1969 upon presentation of photocopy of the Review application”, held the Customs Appellate tribunal in a judgment in an appeal filed by M/s A.F.U International.
The appellant company imported “Compound Chocolate” from Turkey and sought clearance while declaring the value of item at US $ 1. The Director, Valuation while determined the value to be US $ 2.15 per kg. The appellant filed the Review Application challenging the Valuation Ruling 28 of 2014 being contrary to section 25-D of the Custom Act 1969, Section 46 (d) and (g) of the sales Tax Act 1990 and Section 148 (6) and (9) of the Income Tax Ordinance 2001.
The appellant application was dismissed in Order in Review on 16-4-2015. The order in review was then questioned in the instant application. Nadeem Ahmed Mirza, Consultant/advocate appearing for the appellant contended at the outset that Director Valuation is not designated as “Officer of Inland Revenue” under any provision of Sales Tax Act 1990 or Income Tax Ordinance 2001 and thus was not empowered to determine the value for levy of these taxes at the import stage. He maintained that Director has acted in excess of jurisdiction and in fact has usurped the powers of Board (FBR) and thus the determination of value was also unlawful and not sustainable. During the course of arguments the respondents to a query by the court that why the provision of the Section 81 were not exercise despite availability, the respondent maintained that Collector of Clearance Collect orate has either issued verbal or written order not to allow clearance of the consignment made under section 81 of the Customs Act 1969 unless allowed by either the Additional Collector or the Collector. The tribunal noti9ng that if a mandatory condition for exercise of jurisdiction is not fulfilled, then the entire proceedings which follows become illegal and suffer from want of jurisdiction, the tribunal sat a-side the Order in review and Valuation Ruling 625/2013 for determination of value for levy of Sales Tax and Income Tax.
The tribunal also ordered the respondent Director General, Valuation to adhere observations made by the tribunal, to direct Clearance Collect orate to withdraw the issued verbal/written orders in derogation of the provision of Section 81 of the Customs Act 1969 and to allow the authority enunciated in the sub section (1) to exercise his powers independently, fairly and justly. The tribunal in its observation has held that in the instant case provisional determination of value could have been made while securing differential amount of duty, taxes, and other charges between the declared value and payable on the value determined through Valuation Ruling by the Director General of Valuation under section 25-A of the Customs Act 1969.