COLLECTOR OF CUSTOMS APPEALS (APPRAISEMENT), KARACHI vs Messrs U.D.L.
This civil appeal challenged a High Court judgment that granted a customs duty exemption to the respondents based on a notification dated 10-9-1991. The core legal question was whether the notification dated 10-9-1991, which became effective on 12-9-1991, could be applied retrospectively to transactions where customs duty had already been paid under a previous notification dated 16-5-1991. The Supreme Court held that the notification dated 10-9-1991 did not possess retrospective effect and could not apply to transactions that were already completed. The Court determined that since the respondents had already cleared the duty under the earlier notification, the matter constituted a past and closed transaction. Consequently, the Supreme Court allowed the appeal, set aside the impugned High Court judgment, and affirmed that tax exemptions cannot be applied retrospectively to past and closed transactions unless explicitly provided for in the statute or notification.
- Can a customs notification be applied retrospectively to transactions where duty has already been paid?
- Does a notification granting tax exemption apply to past and closed transactions if not explicitly stated?
ORDER
IFTIKHAR MUHAMMAD CHAUDHRY, C.J.--- Learned counsel contended that the High Court had granted exemption of duty to the respondents in view of notification, dated 10-9-1991, which was made applicable with effect from 12-9-1991, although the respondents were not entitled for the same because it had no retrospective effect as per its terms as the duty levied had already been cleared by them in pursuance of earlier notification, dated 16-5-1991. Having gone through both the notifications, we are of the opinion that the notification dated 10-9-1991 was not made operative retrospectively, , therefore, the respondents were not entitled for exemption particularly when the duty had already been paid by them in pursuance of earlier notification dated 16-5-1991 being a past and closed transaction.
2. Thus, for the foregoing reasons, this appeal is allowed and the impugned judgment, dated 31-1- 2002 is set aside. No order alp to costs.