ASSISTANT COLLECTOR OF CUSTOMS, SIALKOT vs AL-BADAR POULTRY FARMS, WAZIRABAD
This appeal arises from an order of the Customs Central Excise and Sales Tax Appellate Tribunal, which set aside a classification order made by the Customs Department regarding imported ventilation systems for poultry farms. The Department had charged customs duty at 25%, whereas the importer contended that, under S.R.O. 26(I)/98, the goods were entitled to a reduced duty rate of 10% and a total sales tax exemption. The core legal question was whether the imported machinery qualified for the tax concessions provided for agro-based industries under the relevant notification. The Lahore High Court dismissed the appeal, holding that the poultry farming equipment fell squarely within the scope of 'Agro-based industries' as defined in the notification. Furthermore, the Court observed that the Department had failed to raise objections regarding the maintainability of the appeal before the Tribunal and had not challenged the factual findings regarding the classification of similar machinery by other customs stations. The Court affirmed that the importer was entitled to the benefit of the exemption notification.
- Does poultry farming equipment qualify as an agro-based industry for the purpose of customs duty exemptions under S.R.O. 26(I)/98?
- Can an appellant raise the issue of the maintainability of an appeal before the High Court if such an objection was not raised before the Appellate Tribunal?
- Is an importer entitled to the benefit of a tax exemption notification if similar machinery has been cleared by the Customs Department at a concessional rate in other jurisdictions?
- Section 194-A, Customs Act 1969
' TASSADUQ HUSSAIN JILANI, J.---This appeal is directed against the order, dated 15-5-2002 passed by the Customs Central Excise and Sales Tax Appellate Tribunal, Islamabad in terms of which respondent/appellant's appeal was allowed and it was directed that the order regarding the "classification done by the respondent on the bill of entry" is set aside. The custom duty and other taxes paid under protest by the appellants, if any, be refunded to them.
2. Facts in brief are that the respondent imported goods subject matter of this appeal i,e, ventilation system for poultry farms which the respondent department classified under the heading 8419-8990 and charged the custom duty at the rate of 25%. The respondent importer made the payment of the requisite duty and got cleared the goods. However, in May, 2000 he moved the Assistant Collector Customs, Sambrial and requested that since the goods imported were exempted from total sales tax and the customs duty was leviable only to the extent of 10%, he wanted to challenge the assessm ent order and he be furnished the order-in-original. The Assistant Collector Customs dismissed his application on the ground, "that there is no question of jurisdiction, is involved and since the goods have also been released, and removed from the customs Court on assessed value on payment of duties and taxes, therefore, the request for issuance of O-IN-O cannot be undertaken and is, therefore, regretted". This order was challenged by the respondent in appeal on which the impugned order has been passed.
3. Learned counsel for the appellant in support of this appeal submitted as under:--
(i) That in terms of section 194-A of the Customs Act, 1969 the order passed by the Assessing Authority can be challenged by way of appeal to be filed within 60 days. Neither appeal was filed within the time limit nor there was an order-in-original to warrant such an exercise.
(ii) That the assessm ent order was a consensual order and the appeal was not competent on that score.
(iii) Referring to the bill of entry at page 8 of the appeal, he submitted that the rate of custom duty had been specified by the respondent himself in the said appeal and he could not take a summersault at a bleated stage.
4. Learned counsel for the respondent challenged the impugned order and submitted that the department had wrongly charged the taxes and duty, that the rate of assessment levied by the department is violative of the notification, dated 17-1-1998 No, S.R.O. 26(I)/98, that the 5 department had not raised the question of maintainability of the appeal before the Appellate Tribunal, and that no law point has been raised in this appeal to warrant serious consideration. . Heard.
6. We have gone through the impugned order and the grounds of appeal. It appears that no objection was taken by the appellant department with regard to the maintainability of the appeal before the Appellate Tribunal. It has not even been urged in the body of the grounds of instant appeal. Having submitted itself to the jurisdiction of the Tribunal it's rather late in the day for the appellant to raise such an objection. Coming to the merits of the case, we have taken note of S.R.O.
No, 26(1)/98, dated 17-1-1998, which specifically provides that, "the Federal Government is pleased to direct that the plant, machinery and equipment not manufactured locally if imported by the Industries specified in Column No,II of the table below shall be exempted from so much of the custom duties as is in excess of 10% and whole of sale tax subject to the following conditions namely:-- S. No, Type of industry
(1) (2)
1. Priority Industries: .................... ....................
2. Agro-based industries:-- 1. .................... 2. .................... 3. ....................
4. Integrated poultry, livestock complex including the facility for processing and packing.
5. ....................
6. ....................
7. Agro-based value added products/bi-products/chemicals (e.g. Cotton, sugar cane, rice, corn- based like cattle feed, cellulose and its products, industrial alcohol, glycerine, fructose, furfural, Xylose etc.)
7. Confronted with the afore-referred provision learned counsel for the appellant tried to argue that poultry farming is not Agro-based Industry and, therefore, the same cannot be extended the benefit of the afore-referred provision. The stand of appellant's learned counsel is not tenable as item No,4 under the Agro-based Industry in the afore-referred notification relates to poultry farming. Even otherwise this objection was never raised by the appellant before the Appellate Tribunal. We further note that the observation of the Tribunal that the goods subject-matter of this appeal had as per practice been classified under head 8419-8990 has not been specifically challenged in the grounds of appeal. It has further not been disputed that the Custom Department, Rawalpindi, cleared similar machinery on similar concession as given in the impugned order.
8. For what has been discussed above, we do not find any merit in this appeal which is dismissed.
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