KARACHI: A custom appellate bench of High Court of Sindh (SHC) comprising Justice Muhammad Shafi Siddiqui and Justice Mahmood A. Khan allowed two constitution petitions C.P. Nos. D-3068 and D-3070 of 2019 filed by M/s Quick Contractor & Traders & M/s Rehman Contractor while dismissing two SCRA No.36 of 2019 & 927 of 2017 filed by Collector of Customs.

The two Special Customs Reference Applications (SCRAs) along with respective connected petitions involved a common question of law arising out of Tribunal’s judgments.

The connected petitions were filed for implementation of Tribunal’s judgments. The court for the sake of convenience treated the SCRAs as leading matters as the answers to the questions arising out of the references were to decide the fate of the petition as well.

According to the details respondents in both the references i.e. Rehman Construction Company and M/s Quick Contractors & Traders imported old and used truck-mounted crane. Apparently there was no issue of its valuation but the department contested the importability on the touchstone of Para 9 of Import Policy Order 2013. 3. Preliminary objection of the department is that the appeals were heard by a Single Member of the Tribunal (without Member Technical) and hence under section 194-C of Customs Act, 1969 it is unlawful and on this count alone the impugned judgments are liable to be set aside.

On merit, the common objection of the department is that the crane and the truck have been purposely imported as being one unit, though they are not. Two components (crane + truck) of different make were stacked together to make it one unit to bring it within specifications of IPO 2013. The truck under Import Policy Order 2013 is not importable except specialized vehicles and hence under the garb of it being mounted with crane had been imported as being permitted under the aforesaid Import Policy Order 2013 with intention to remove crane for exclusive use of truck for transportation of goods and persons.

The department’s another objection was based on examination, which suggests that the crane is of a separate make as compared to truck and was purposely welded over it to ensure its one unit and hence after declaring it as a truck mounted crane/crane mounted truck, the goods are being imported on payment of duties and taxes.

The respective counsels who were heard at length argued that as far as issue of Tribunal only single Member heard appeal and decided in the absence of Member Technical is concerned, it was an internal administrative arrangement.

The bench observed that same question came before a Division Bench of Lahore High Court in the case of Bagh Ali1 wherein it has been observed as under:- “Thus, considering and construing section 194-C(3)(4) of the Customs Act, 1969 and section 46(9) of Sales Tax Act, 1990, from the plain reading thereof, it is abundantly clear that the Single Member Bench of the Tribunal has the jurisdiction to decide certain class of cases, but the jurisdiction is dependent and circumvented by certain conditions, especially with reference to subsection 4, of entrustment/allocation by the Chairman, which authority of the Chairman is circumscribed that such matter/case should have been earlier allotted to a Bench of which the Single Member should be a part/a Member”.

The bench also noted that Import Policy Order 2013 in terms of Para 9(ii) provides import of used plant, machinery and equipment which may be summarized as secondhand specialized machinery by construction, mining and petroleum sector. The aforesaid Import Policy Order 2013 provides that the construction companies duly registered with Pakistan Engineering Council are allowed to import secondhand plant, machinery and equipment actually required for their projects in Pakistan subject pre-shipment certification by any one of the prescribed pre-shipment inspection companies listed at Appendix ‘H’ to IPO 2013 to the effect that the plant, machinery and equipment are in good working condition and are not older than ten years. Sub-Para (6) of (ii) of Para 9 of Import Policy Order 2013 provides further that commercial importers were also allowed to import used plant, machinery and equipment excluding specialized vehicle-mounted machinery or transport equipment on behalf of construction companies duly registered with Pakistan Engineering Council subject to the conditions mentioned in Sub-Para (1) of Para II of 9 of IPO 2013, as observed above.

The bench held that there is no denial that in both the cases/references the certificate of registration of Pakistan Engineering Council are available.

The counsel for department argued that insofar as two independent units being stacked or assembled or welded together to make it one unit is concerned, this has been clarified by the Ministry of Commerce vide their letter dated 12.03.2012 when earlier Import Policy Order 2009 was in vogue. Para 9 of IPO 2009 is pari materia to Para 9 of Import Policy Order 2013. With reference to Para 9 of Import Policy Order 2009, the Ministry of Commerce clarified the objections of the customs raised on the same propositions that the crane lorry over the truck was stacked and welded and does not seem to be a factory-fitted and of different makes. The letter of Ministry for the sake of convenience is reproduced as under:- The Ministry has received the attached correspondence whereby Shaheen Builders, Islamabad has stated that Customs are refusing to release truck-mounted crane lorries despite the fact that all conditions mentioned in para 9(ii)(5) read with Appendix-I of the IPO 2009 have been fulfilled. Customs have objected on the grounds that the crane system is welded and does not seem to be factory fitted.

The bench after detailed arguments held that presence of pre-shipment certificate, no extraneous material, unless it is establish otherwise, can be taken into consideration in forming a view other than described in pre-shipment certificate.

“The only question that arises out for consideration of this Bench is whether the subject vehicle having two components of different makes (i.e. crane and truck) are restricted by Import Policy Order 2013? The question is answered in negative in view of above facts and circumstances. The impugned judgments thus do not call for any interference and the Special Customs Reference Applications are dismissed whereas the petitions are allowed as prayed” the bench ordered.