Law: Customs Act, 1969

Section: 21(c),35,37

THIS THIS JUDGMENT DELIVERED BY: DELIVERED BY: SABIHUDDIN AHMED, JUSTICE:--------- The admitted factual position appear to be that the petitioner had imported certain chemical and dyes which were used as a raw material for manufacture of garments and were exported aboard, The petitioner claims drawback/rebate on customs duty in terms of S.R.O. No.187(I)/91,, dated 10th March, 1991. Their claim however, came to be rejected by the respondent No.2 on the ground that para. 2-B of the Standing Order No.5 of 1992, dated 19th March, 1992 require that C&F value of the temporarily imported items should not be more than 10% of the FOB value of the finished export product. 2. Mr. Sohail Muzaffar, learned counsel for the petitioner contended that the aforesaid condition imposed through a Standing Order was invalid and entirely unwarranted inasmuch as it would deprive several importers of duty drawback or rebate otherwise permissible merely on account of the fact that the imported goods constituted a substantial part of the exported product and their value exceeded 10% of the value of the exported goods. Learned counsel further argued that such an arbitrary condition could not be imposed through a Standing Order without even notifying the same in the Gazette. 3. Learned Standing Counsel, on the other hand, urged that such a condition had been placed to ensure that an importer is not allowed drawback or rebate in excess of the customs duty earlier paid by him. 4. We have carefully considered the relevant statutory provisions relating to drawback and repayment of duty drawback are generally dealt with in sections 35 to 37 of the Customs Act. Section 35 deals with goods temporarily imported into Pakistan for a period of two years (extendable up to 3 years by the Collector of Customs for sufficient cause) and re-exported without being used and in such cases the importer is entitled to drawback at the rate of seven-eighths of the duty paid. Under section 36 drawback is permissible upon re-export of imported goods in the same state after having been put to temporary use in Pakistan and the rate of drawback is prescribed by the statutory rules. Admittedly the petitioner's case…

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