Law: Central Excise and Salt Act, (I of 1944)

Section: 3

Law: Constitution of Pakistan, 1973

Section: 199

[Central Excises And Salt Act (I of 1944)]........S 3 --- Constitution of Pakistan (1973), Art.199 --- Locus poenitentiae, principle of --- Central Board of Revenue, gave choice to manufacturers either to be assessed on capacity tax basis or under supervised clearance system --- On choice of petitioners, permission was granted to them to be assessed on capacity tax basis --- On basis of such licence of Authorities, petitioners embarked upon manufacture of goods, started paying duty on capacity tax basis and Authorities collected same on that basis without any objection---After about one year, on basis of audit report, a notice was issued to petitioners for re-opening of their case and for realization of duty on basis of supervised clearance system--­ Permission to be assessed on capacity tax basis, once granted and acted upon, could not be recalled or withdrawn without issuing show-cause notice to petitioners in view of principle of locus poenitentiae.---[Locus poenitentiae]. Pakistan v. Muhammad Himayatullah Farrukh P L D 1969 SC 407 ref. ORDER This petition under Article 199 of the Constitution of Islamic Republic of Pakistan calls in question the order dated 7-3-1988, whereby the order passed by the subordinate Central Excise and Customs authorities was upheld and the petitioner was asked to pay the duty on the goods manufactured on actual production basis instead of capacity tax system. 2. The background of the case is that vide notification dated 28-6-1979, the Central Board of Revenue gave a choice to the manufacturers either to be assessed on capacity tax basis or under the supervised clearance system. In consequence, the permission was granted to the petitioners pending the issuance of licence which was granted on 20-2-1980. The petitioners' grievance is that on the basis of his licence, he embarked upon' manufacture of electric fans and started paying duty on capacity tax basis and the department started to collect the duty under this system without objection. It was further submitted . that throughout the department posted no staff on the petitioners factory which further support the contention of the petitioners that supervised clearance system was…

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