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Concessionary rate of sales tax not applicable on some imported finished goods, says ONO

Concessionary rate of sales tax not applicable on some imported finished goods, says ONO

ISLAMABAD: The Collector Customs Adjudication Islamabad has issued an Order-In-Original that concessionary rate of sales tax will not apply on finished goods of leather, textile, carpets, sports, and surgical items imported under the SRO 1125 (1) 2011, amending SRO 504 (1) 2013. It has ordered the MCC Islamabad to recover the amount of non-realized revenue of Rs 6.23 million along with the penalty of Rs 1 million from M/s Friends Traders, Shanghai Plaza, College Road, Rawalpindi.

According to details, M/s Friends Traders imported the finished goods of leather, textiles, carpets, sports and surgical goods from China and got the same cleared from Islamabad Dry Port Islamabad at the concessionary sales tax rate of 5 percent under SRO 1125 (1) 2011.

The Collector Adjudication Islamabad has said in the ONO that the perusal of amending SRO 504 (1) 2013 clearly shows that finished goods of leather, textile, carpet, sports and surgical were specifically excluded from any concession of Sales Tax. However, concession was still availed by the M/s Friends Traders on the finished goods illegally. It is evident that the importer was not entitled to the concessionary rate of Sales Tax under the SRO 1125(1) 2011 after the issuance of amending SRO 504 (1) 2013 which was conspicuously excluded from the finished goods from the concession of Sales Tax. Thus all the charges leveled in the show cause notice stand established and concession of revenue so availed illegitimately has to be deposited. He ordered the importer M/s friends Traders to pay the amount of tax of Rs6.23million into government treasury. A penalty of Rs1million has been also imposed on the Friends Traders.