Customs recover over Rs1.0 billion worth of regulatory duty

KARACHI: Revenue of over a billion rupees is realized, as the Supreme Court of Pakistan has dismissed the ‘leave to appeal’ application of 121 importers seeking stay against the encashment of bank guarantees submitted by them against provisional release of their consignments.

The importers were contesting the imposition of Regulatory Duty before the Sindh High Court wherein the court order release of the consignments on submission of bank guarantees equivalent the regulatory duty until the cases was decided.

Later, the High Court dismissed 121 petitions challenging imposition of regulatory duty with an option for the importers to file appeal by September 10,2015.

Subsequently, the Model Customs Collectorate of Appraisement East started encashing the bank guarantees and securities submitted by the importers against provisional release of their consignments.

The importers approached the Supreme Court of Pakistan and would seek ‘leave to appeal’ on September 14, 2015 along with stay against withdrawal of securities/guarantees, which the apex court did not find worth hearing.

It may be recalled Sindh High Court dismissed as many as 121 petitions filed by iron and steel importers challenging the regulatory duty on the import of several goods vide amendment to SRO 568(I)/2014. These importers had submitted the bank guarantees equivalent to the regulatory duty against the provisional release of their consignments.

Deputy Collector Rana Ali Waheed from MCC Appraisement West and Deputy Collector Jahanzaib Abbasi from Customs Enforcement South pursued the case and it was due to their efforts the case was so strong that the High Court dismissed the petitions.

However, Lahore High Court suspended the imposition of Regulatory Duty enforced via SRO 601(I)/2015 effective to the extent of Collectorates falling within the jurisdiction of Lahore High Court.

An official said that the department had filed an intra-court appeal against the decision of Lahore High Court and the orders of SHC and Supreme Court would be presented in favor of that application.

It is hoped that the decision of Lahore High Court would be reverted.

Resultantly, the importers diverted their shipments to Lahore dry port in order to avoid Regulatory Duty. Sindh High Court in interim order had advised the importers to deposit the differential amount with the Nazir of the Court or submit bank guarantees against provisional release of goods.

The government had imposed regulatory duty ranging 5.0 percent to 15 percent on several items being imported from China under free trade agreement (FTA). The regulatory duty was in excess of already settled duty and taxes.

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