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M/s Fauji Fertilizer approaches SHC against additional charges on Sulphate of Potash

M/s Fauji Fertilizer approaches SHC against additional charges on Sulphate of Potash

KARACHI: M/s Fauji Fertilizer Company Limited Eastern Zone, Bin Qasim, Karachi has filed a constitutional petition before the Sindh High Court (SHC) against imposition of additional charges on import of Sulphate of Potash (SOP) in bulk under Sales Tax General Order No 103/2019 dated August 07, 2019 by the Model Collector of Customs KAPE, Appraisement East.

On 14 September 2019, counsel for the petitioner stated that petitioner imported Sulphate of Potash (SOP) in bulk condition for its own manufacturing and filed goods declaration through WeBoC system of Pakistan Customs.

He submitted that the collector of Customs KAPE, Appraisement East on the basis of Sales Tax General Order No 103/ 2019 required the petitioner to file undertaking in respect of printing of retail price of the goods after clearance from the customs and pay additional sales tax on such retail price which is not less than 130 percent of the customs value increased by assessed customs duties, excise duty and other applicable taxes and charges excluding sales tax.

He further stated that he informed the respondent that the fertilizer is being imported in bulk loose form without any retail packing, therefore, conditions/restrictions as specified in the sales tax general order are not applicable, further, the said imported fertilizer, after clearance from the customs port, is to be packed in saleable quantities (50 kgs bags) and subjected to sales tax as prescribed in section 3(2) (a) read with section 3(2)(aa) of the act.

Counsel said that however respondent did not accept the contention of the petitioner and forcefully charged additional sales tax amounting to Rs341,675 for clearance of fertilizer imported in bulk loose form, despite that the petitioner is a regular importer of fertilizer from self-manufacturing and thereafter selling in retail market whereby further goods are on its way and would be regularly entering the Karachi Customs Ports for clearance.

Citing secretary Finance, chairman FBR, KEWB Imports East Bulk, Appraisement East, secretary (ST & FE-Policy) and others as respondents, petitioner pleaded the court to declare that said goods bulk form cannot be charged to conditions and sales tax as per third schedule and direct them not to the charge additional sales tax.