KARACHI: Afghan Transit goods are protected under para 4 of the Import Policy Order. This was held by a SHC appellate bench comprising Justice Muhammad Junaid Ghaffar and Justice Zulfiqar Ahmed Khan.

The bench was hearing a petition filed by  Muhammad Naeem who has sought a declaration that the impugned Notifications bearing SRO No.1397(I)/2023 dated 3.10.2023, SRO No.1401(I)/2023 dated 7.10.2023, SRO No.1402(I)/2023 dated 7.10.2023, and SRO No.1380(I)/2023 dated 3.10.2023, whereby, certain restrictions have been imposed on goods meant for Transit to Afghanistan are not applicable on the seven consignments as detailed in Para 2 of the memo of the petition.

The Counsel for the Petitioner  contended that the seven consignments in question were imported much prior to the date of issuance of the impugned Notifications; that a vested right has already accrued in favour of the Petitioner; that the goods in question are for transit to Afghanistan and therefore, even otherwise, no such restrictions can be imposed by the Federal Government so as to regulate or ban the transit cargo.

He further contended that clarification of Ministry of Commerce dated 17.11.2023 also supports the stance of the Petitioner; that Para 4 of the Import Policy Order notified vide SRO 545(I)/2022 dated 22.04.2022 already provides protection to the effect that any amendment made in the Import Policy Order shall not be applicable to such imports where either a bill lading or a letter of credit was issued or established prior to any such amendment; that SRO 151(I)/2004 dated 10.03.2004 which has been amended through impugned SRO 1397 is not at all relevant as presently, the transit trade between Pakistan and Afghanistan is regulated by a new Agreement dated 28.10.2010 whereas, the SRO in question is no more valid as it was issued in respect of the previous Agreement dated 2.3.1965 and therefore, in view of the law laid down by the Courts, the Petitioner is entitled for release of the seven consignments in question.

Khalil Ahmed Dogar advocate representing the concerned Directorate of Afghan Transit Trade has opposed the Petition on the ground that insofar as the Customs Department is concerned, they are bound to comply the directions / orders of the Ministry of Commerce which were issued vide SRO 1397, whereas, except one consignment, the remaining six have arrived after the cut-of-date as notified by the Ministry of Commerce and the only remedy available to the Petitioner is by way of re-export of such goods. He relied on a number of judgments  including  Muhammad Amer Saeed v. Model Customs Collectorate of Customs (2016 PTD 2910), Haji Abdul Raziq Khan v. Federation of Pakistan (2014 SCMR 1821), Pakistan v. Aryan Petro Chemical Industries (Pvt) Ltd. (2003 SCMR 370) and other s and prayed for the dismissal of instant Petition.

Assistant Attorney General along with Ms. Maria Qazi, Joint Secretary (FT-II), Ministry of Commerce Government of Pakistan has also opposed instant Petition on the ground that Para 4 of the Import Policy Order is not relevant inasmuch as the imports under Afghan Transit Trade Agreement are more specifically governed by Para 6(3) of the Import Policy Order and therefore, no protection can be claimed under Para 4 thereof. It has been further contended that insofar as letter dated 17.11.2023 issued by the Ministry of Commerce is concerned, it is only relevant for relaxation in the levy of processing fee and the procedural requirements; however, it is not applicable on those goods which have been banned vide SRO 1397. They have also prayed for dismissal of instant Petition.

The bench after hearing the sides noted that Petitioner represents its various clients stationed in Afghanistan who have imported seven consignments containing various goods i.e. Tyres, Miscellaneous Cosmetic items and Textile Fabric as detailed in Para 2 of the memo of petition. At the same time, Respondent No.2 has also given details of the consignments along with their final remarks as to the status of the goods in question.  it appears that there are seven different consignments of various Petitioners and prior to the issuance of SRO 1397 by Ministry of Commerce, there was no impediment in the transit of subject goods, whereas, besides this ban, till the filing of this petition, the goods which are not banned under the Afghan Transit Policy, have been subjected to a processing fee at the rate of 10% ad valorem as per Notification issued by FBR bearing SRO No. 1380. At the same time, another SRO No. 1402 was issued whereby, certain amendments were made in the Customs Rules, 2001 governing the procedure of Afghan Transit goods and for the words “revolving insurance guarantee”, the words “bank guarantee” was substituted. There were some other changes in the procedure regarding handling of Afghan Transit Page 5 of 19 Trade Cargo as well. The said Notification further provided that it shall not be applicable on Afghan Transit goods declaration filed prior to issuance of the Notification dated 07.10.2023. Thereafter, on 27.11.2023 two further SROs bearing No. 1711(I)/2023 and 1712(I)/2023 both dated 27.11.2023 were issued making certain amendments in SRO No. 1380 and 1402 giving further relaxation, whereby, it has been notified that these notifications shall not be applicable to Afghan Transit Trade Cargo arrived at Pakistani Ports as determined from the berthing date of vessel during the period commencing on the 3rd day of October, 2023 and ending on the 16th day of November, 2023, and shall apply thereafter. Since the seven consignments as mentioned in the above table(s), are protected as per the amending SRO’s dated 27.11.2023, therefore, for the present purposes, the only issue left for this Court to decide is the applicability and implication of SRO 1397 issued by the Ministry of Commerce.

The court noted that in the same Notification a proviso has been added which states that serial No. 2A to 2G shall be subject to two conditions namely, (i) that they shall not apply to the transit cargo already arrived at Pakistani Ports, whereas, the cargo at high seas shall have the option of re-export upon arrival at Pakistani Ports, and (ii) they shall not be applicable to the transit cargo meant for foreign grant in aid to Afghanistan. Insofar as the present issue is concerned, it is only in respect of the first part of the proviso that whether the exception which has been made applicable on Serial No. 2A to 2G would cover the goods imported by the Petitioners who claim that the same had already arrived at Port. As could be seen from table(s) at Para 2 above, the consignment at Serial No.7 had arrived prior to 3.10.2023 and is not hit by the amending SRO 1397. The Page 7 of 19 rest of the consignments have arrived on 3.10.2023, 4.10.2023 and 6.10.2023. The Petitioners case is that Para 4 of the Import Policy Order, 2022 notified vide SRO No. 545(I)2022 dated 22.04.2022 protects the goods in question, whereas, the stance of the Ministry of Commerce as agitated by the learned Assistant Attorney General and the Joint Secretary (FT-II), Ministry of Commerce Government of Pakistan is that it is to be governed by the Para 6(3) of the Import Policy Order, 2022 as it is the prerogative of the Federal Government to notify the effective date of SRO 1397.

The bench held tha in its considered view that the principal of vested right as enunciated by the courts of law is very much applicable in the instant matter, hence, the impugned SRO 1397 does not appear to be applicable on the goods in dispute which are to be governed by the policy as in vogue prior to the issuance of SRO 1397 dated 03.10.2023. Accordingly, the Petition is allowed in the above terms.