SHC fixes Aug16 to decide contentious issue of Regulatory Duty

KARACHI: A customs appellate bench of High Court of Sindh comprising Justice Aqeel Ahmed Abbasi and Justice Agha Faisal fixed Aug 16 to decide the contentious issue of imposition of Regulatory Duty (RD).

The bench was hearing dozens of identical petitions filed jointly by hundreds of importers who prayed to the court to stop customs department from en-cashing sureties lying with the Nazir of the court allegedly taking advantage of an order of the Supreme Court in an appeal filed by the Pakistan Customs impunging a judgment passed by another customs appellate bench of SHC then headed by Justice Muneeb Akhtar, now judge of Supreme Court.

The said judgment invalidated the imposition of Regulatory Duty on ground that it was not issued lawfully and federal minister (finance) was not competent to order imposition of the RD. The bench held that Rules of Business 1973 were not adhered to while issuing the order.

The customs went into appeal before the apex court but in the meantime amended law empowering it to collect RD. The customs withdrew the appeal. The apex court allowed the withdrawal holding that amendment if challenged before a competent court of law, such challenge would be decided independently.

Earlier the SHC bench heard the counsel for petitioners who maintained that order passed by SHC earlier has attained finality and hence respondent custom officials of model custom collectorates including East, West, Preventive, Port Qasim cannot seek encashment of sureties. They challenged the amendment Section 221 (2) of the Customs Act 1969 relying on case laws known as Molasses, case, SCMR 1993 and others.

Khalid Rajpar advocate representing MCC West and Preventive contesting the submission by petitioner referred to the judgment by SHC and said it invalidate action by customs on ground that proper procedure was not adopted while ordering imposition of RD. He argued that after recent amendment, RD can be imposed prospectively. He objected to the plea by petitioners for release of securities.

The bench accepting the plea ordered status quo till Aug 16.

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