Law: Customs Act, 1969

Section: 18

Customs Act, (IV of 1969)---S. 18---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), S.2(3)(i)(a)---S.R.O. 1050(I)/95-Goods dutiable---Levy of regulatory duty---Legality of---Release of goods on interim orders of High Court against Bank guarantee--High Court declared the imposition of regulatory duty as unlawful---Supreme Court accepted the appeals of the Department after a lapse of two years and declared the imposition of regulatory duty as lawful---Notice for payment of amount in terms of lapsed guarantees alongwith compensation--­Complainant contended that Supreme Court setting aside the High Court's did not revive the liability of the bank or the complainant to make payments in terms of the lapsed bank guarantees--­Validity--Customs authorities were responsible to demand payment and press for recovery of customs duty and sales tax when the decision was taken in their favour---Noh-enforcement of guarantees suited the complainant as well as the Bank as the customs authorities did not pursue the recovery of duty and taxes due to collusion or neglect---When appeals of both the sides were decided by the Supreme Court maintaining the levy of the customs duty, sales tax and the regulatory duty, it was the responsibility of the Customs Authorities to effect recovery and it was also obligatory on the part of the Bank to fulfil its liabilities and meet the conditions of the guarantee---Inaction and inefficiency on the part of the customs officials in not recovering the dues, could not be overlooked or condoned---Contention that the Bank was absolved of the responsibility of paying dues, for which they had submitted the guarantees and encashment notices were first issued on 5-8-1996 and subsequently in 1999, 2001 and 2002, was not accepted---Claim that bank, guarantees furnished by the complainant had lost validity was not established---Notice issued was not accepted being illegal, improper, of no legal effect---Complaint lacked merit and was rejected by the Federal Tax Ombudsman. FINDINGS/DECISION Messrs United Finishing Mills Limited, Faisalabad, have complained against the Customs authorities for issuing notices to Messrs Saudi Pak…

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