' AQEEL AHMED ABBASI, J.---Since common questions have been formulated in the instant Customs Reference Applications arising from the combined impugned order dated 21.02.2015 passed by the Customs Appellate Tribunal, Karachi Bench-I, Karachi in Customs Appeal No, K-863/2014 and Customs Appeal No,K-864/2014, therefore, both the reference applications are being heard and disposed of at katcha peshi stage with the consent of the learned counsel for the applicant.
2. Following common questions have been formulated in both the instant references, which according to learned counsel for the applicant, are questions of law arising from the impugned order passed by the Appellate Tribunal in the instant case:- "(1) Whether in the facts and circumstances of the case, particularly in the presence of commercial transaction documents i,e, B/L and Invoice, the learned Appellate Tribunal has not erred in law to treat the imported goods as donation within the meaning of Note (ii) of Sub- Chapter-Ill to Chapter-99 of the Pakistan Customs Tariff?
(2) Whether the impugned goods, i,e,. Ducted Type FCU's and Wall Mounted FCU's with complete standard Accessories, can be termed as having "educational and scientific character," within the meaning of condition No, (i) of PCT Heading 9915 of the Pakistan Customs Tariff?
(3) Whether in the facts and circumstances of the case the learned Appellate Tribunal has not erred in law to grant exemption to goods like "Ducted Type FCU 's and Wall Mounted FCU's with complete standard Accessories" under PCT Heading 9913, of the Pakistan Customs Tariff?"
3. Learned counsel for the applicant has read out the proposed questions, the impugned order passed by the Customs Appellate Tribunal and the orders of the authorities below, and submits that the Customs Appellate Tribunal has erred while holding that the respondent had fulfilled all conditions as envisaged under subsection (III) of Chapter-99 of the Pakistan Customs Tariff, therefore, had rightly claimed exemption from levy of customs duty and sales tax in terms of PCT Heading 99.13 Sub-Chapter (3), whereas, according to learned counsel, the goods imported were classifiable in PCT Headings 99.15 and not entitled to claim exemption.
4. We have heard the learned counsel for the applicant, perused the record as well as the combined impugned order passed by the Customs Appellate Tribunal in the above cases and have also examined the conditions imposed under PCT Headings 99.13 and 99.15 as well.
5. Briefly the facts as stated in the memo. Of instant reference applications are that the respondent imported the consignment of "air handling units complete with standard accessories and fittings" and filed GD No,KAPE-HC-14643, claimed classification under Heading 99.13. However, concerned Deputy Collector of Customs, Model Customs,. Collectorate of Appraisement (East), Karachi held that goods are classifiable under PCT Heading 99.15, and also refused the claim of exemption from payment of customs duty and sales tax, on the other hand assessed the GDs by imposing customs duty at the rate of 20%, sales tax at the rate of 17% and additional sales tax at the rate of 3%. Such assessm ent was assailed by the respondent by filing an appeal before Collector (Appeals), who has also declined the claim of exemption to the respondent, who being aggrieved by such order passed by the Commissioner (Appeals) Inland Revenue, preferred second appeal before the Customs Appellate Tribunal, who vide combined impugned order under reference, has been pleased to set-aside the order of Collector (Appeals) and granted exemption as claimed by the respondent in respect of imported consignment from levy of customs duty and sales tax.
6. From perusal of the above impugned order passed by the Customs Appellate Tribunal, it appears that after having examined the material facts and the evidence available on record, and the scope and the implications of PCT Heading 99.13, a detailed finding on facts has been recorded, according to which, the treatment meted out by the respondent department to the consignment of the appellant has been rightly set-aside. Similarly, the claim of the petitioner seeking exemption from payment of customs duty and sales tax on the subject consignment, has also been found to be correct, as the respondent is admittedly a charitable and non-profit making institution, whereas, the Commissioner of Income Tax while recognizing the nature of business of the respondent, had also issued a certificate under section 2(36)(c) of Income Tax Ordinance, 2001 to this effect. It will be advantageous to reproduce the relevant finding of the Appellate Tribunal as recorded in Paras: 5 to 8 and also Para 10 of the impugned order, which reads as follows:-- "S. We have heard arguments of both sides and read the case record carefully. PCT Heading 9913 allows levy of 0% duty on gifts or donations received by a charitable non-profit making institution.
The definition of 'Charitable non-profit making institution and Gift' has been provided vide Notes
(i) and (ii) of Sub-Chapter (III) of Chapter 99 of the Pakistan Customs Tariff according to which 'charitable non-profit making institution' is the one which is approved for the purpose of section 2(36)(c) of the Income Tax Ordinance, 2001 and 'Gift' or 'donation' means goods other than vehicle of Chapter 87. The appellants have produced a valid certificate issued under section 2(36)(c) by the Commissioner Income Tax under the Income Tax Ordinance, 2001. They had received gift of goods other than vehicle of Chapter 87 (i,e, "Air handling units complete with st"ndard accessories and fittings") from a donor residing abroad. The donor vide has letter dated 19.08.2013 has confirmed that no condition whatsoever is attached with the gift and the University is free to use the Goods according.To their need in the university. An undertaking was also furnished by the University that they will not sell the goods and use them exclusively in the University. Thus, all the conditional ties of heading 9913 are fulfilled and the goods qualified classification under heading 9913.
6. The argument that the goods in question have multiple use and hence not entitled for exemption under heading 99.13 is not convincing as no such condition has been mentioned for the purpose of classification under this heading. No word can be added or deleted in the statute as has been decided in the number of judgments of the Superior Courts. Thus the addition of 'Multiple use' by the Collector (Appeals) for the purpose of allowing exemption under heading 9913 is patently wrong.
7. The contention that "Air handling units complete with standard accessories and fittings" do not have educational character is also farfetched. The goods of educational at character are governed vide heading 9915 whereas 'gifts or donations' are dealt under heading 9913. The appellants had furnished an undertaking at the time of release that the goods will be exclusively be used in the University. The respondents could not establish that the goods were disposed of or used for any other purpose. On the other hand the appellants offered that Customs may verify that the impugned goods were dually installed in the University. Thus the goods were/are being used in accordance with the declared objectives of the Habib University Foundation.
8. During the hearing proceedings the respondents argued that the appellants should have approached the senior officials of the Collectorate before involving jurisdiction of the appellate forum. Further, Habib University is charging very high fees from the students and hence cannot be treated as charitable non-profit making institution. The arguments are not at all convincing as the importer (Appellant) has the right to file an appeal before the Collector Appeals in terms of section 193 of the Customs Act,, 1969 and before the Customs Appellate Tribunal under section 194 of the Customs Act, 1969. The right given to a citizen under the law cannot be denied. The definition of 'charitable non-profit making institution' has been given vide Note (i) to Sub-Chapter III of Chapter 99 of the Pakistan Customs Tariff. The only requirement for the purpose is approval of the institution under section 2(36)(c) of the Income Tax Ordinance, 2001. The University has furnished the requisite approval under the Income Tax Ordinance, 2001. The collection of higher or lower fees from the students by the University is not the criteria to term the University as charitable' 'non making institution' or otherwise.
9.
10. By getting the strength from above referred statutory obligations and interpretation of law, we are of the considered view that the appellant's contentions carried weight and should have been recorded in accordance with law. Since the appellant had fulfilled all conditions as envisaged in sub-Chapter (III) of Chapter 99 of the Pakistan Customs Tariff and the observations made during the hierarchy of the customs by the concerned Collectors are perverse from the evidence having patent illegal infirmities hereby declared void, ultra vires and without lawful authority, accordingly the appeal in hand stand accepted/allowed with no order as to cost."
7. While confronted with above finding on facts as recorded by the Appellate Tribunal in the aforesaid terms, learned counsel for the applicant could not controvert the same nor could assist this Court as to how such finding is erroneous, or based on misreading/non-reading of the evidence. We are of the opinion that the finding as recorded by the Customs Appellate Tribunal with regard to classification of goods under PCT Heading 99.13 and the claim of exemption by the respondent from payment of customs duty and sales tax, is based on peculiar facts and circumstances of the case, which otherwise depicts correct legal position as stated by the Customs Appellate Tribunal in the impugned order, hence, does not require any interference by this Court. We are of the opinion that no substantial question of law has arisen from the impugned order passed by the Appellate Tribunal in the instant case. Accordingly, instant reference applications being devoid of any merits are hereby dismissed in limine along with listed applications.