SHC allows SCRAs filed by importers of Silos for grain storage

KARACHI: A customs appellate bench of High Court of Sindh hearing identical Special Customs Reference Applications (SCRAs)  filed by Mukhtar Feeds, Summundri, Asia Flour Mills, Muridke, AlMeezan Poultry Feeds against judgment of Customs Appellate Tribunal in appeals.

The Customs Appellate Tribunal upheld the Orders in Original Passed by the Adjudication Collectorate confirming the orders by the forums below denying exemption from Custom Duty and Sales Taxes on imported Silos under a clarification issued by the FBR.

The bench  heard the Counsel   for  the Applicants   who submits    that   the    Tribunal   (Single  Bench)   has   seriously erred   in  law  as  well  as  on  fac inasmuch  as  an  earlier  Judgment  of a Division Bench  of the  Tribunal dated  06.06.2017   passed   in  Customs  Appeal  No.  K-432/2016   and other  connected matters   decided  in favour  of the Applicants has  been ignored;

IT was also submitted that  the Tribunal has  failed to appreciate  that  the clarification of FBR dated  25.5.2015 was issued  subsequently  after  clearance ofthe consignments  and  could  not  have been  applied   retrospectively.

The counsel for applicant also pleaded that the  earlier   clarification of FBR was still  in  field;  that   at  the  time  of transposition  of exemption SRO’s 575 and  SRO 722,  to 5th  Schedule to the Customs  Act,  1969,  (Custom Act)  and 8th   Schedule  to  the  Sales  Tax Act,  1990   (Sales  Tax  Act)   specific   exemption  has   been   granted from customs duty and sales  tax on  the import of  silos; hence even otherwise, a subsequent clarification was immaterial as  the exemption was always  available under the Acts; that earlier Division Bench of the Tribunal has  correctly held that  when  the exemption  was  clear  and specific under   the  statute,   then there  was  no occasion for FBR to give any clarification; that  in the  explanation to the exemption notificationas  well as the  Schedules thereto,  no  restriction has  been provided as to the  goods being classifiable under   Chapter   84  or  85 and therefore, the  order  of the Tribunal is liable to be set  aside  and  the Questions  of law be answered in favour of the Applicants.

The bench after hearing the sides in details including Afsheen Aman Advocate representing Port Qasim Custom Collectorate and Principal Appraiser Tariq Aziz answered all the questions in favour of the importer millers and against the department. The bench held that Silos are the part of machinery and exemptions from Custom Duty and Sales Tax is avaialable to the importers.

Following is the text of order of the court:

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