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DG Valuation revises customs values of bearings

DG Valuation revises customs values of bearings

KARACHI: The Directorate General of Customs Valuation has revised the customs value of bearings through Valuation Ruling No 1135/2017 under Section 25-A of the Customs Act, 1969.

According to details, customs values of bearings were determined under Section 25-A of the Customs Act, 1969, vide Valuation Ruling No.953/2016, on October 14, 2016. The valuation ruling was challenged by different importers through revision petitions before the Director General Customs Valuation. The Director General disposed of the petitions vide Order-in-Revision No. 284/2016 dated 04-01-2017.

The market inquiry also revealed that the values have been fixed correctly by the Director Customs Valuation.”

The aforesaid valuation ruling and Order-in-Revision were challenged before the appellate tribunal, Karachi vide Customs Appeal No. K-35/2017. One of the importers, M/s Asghar Enterprises, filed a Complaint before the Federal Tax Ombudsman, Karachi vide Complaint No. 000078/2017. The Bearing Trade Group also approached the Chairman, Federal Board of Revenue Islamabad through a letter of Pakistan Automobile Spare Parts Importers & Dealers Association dated 02-03-2017.

Meanwhile on expiry of 90days the importers approached this office with the request to re-determine customs values, claiming that the values determined vide Valuation Ruling No.953/2016, dated 14-10-2016 became irrelevant, in light of Sindh High Court’s judgments. The Customs Appellate Tribunal, Karachi remanded the case to Director Valuation, with certain observations for redetermination of customs values, after giving the opportunity of being heard to all stakeholders, within one month. Federal Tax Ombudsman required an under-taking by the Directorate General Customs Valuation to issue fresh Valuation Ruling within the time limit specified by the Appellate Tribunal. Therefore, this Directorate General initiated an exercise for determination of customs values of Bearings.

Different meetings with stakeholders were held on 07-03-2017 and 12-04-2017. Importers had been requested to furnish the invoices of imports during last three months showing factual value.

Websites, names and E-mail addresses of known foreign manufacturers of the item in question through which the actual current value can be ascertained.

Copies of contracts made / LCs opened during the last three months showing the value of item in question.

Copies of sales tax invoices issued during last four months showing the difference in price (excluding duty and taxes) to substantiate that the benefit of difference in price is passed on to the local buyers.

During the course of the meeting, Bearing Trade Group and the importers were of the view that the values of bearings in the existing valuation ruling were much higher than the prevailing LME prices of raw material in international markets. They stated that industrial bearings, which were produced in smaller quantity, with high quality, were relatively expensive but all other bearings were much cheaper.