' MIR HAZAR KHAN KHOSO, J.--Facts of this case are simple and brief. Customs Authorities by virtue of Section 53 of Income Tax Ordinance, 1979 have been authorized to recover from the importer of goods, advance tax at the rate of 1-1/2 % chargeable ad valorem, during any financial year.
2. In the instant case petitioner imported Vessel called "BARGE BARAKA-I" for purposes of ship- breaking. The vessel arrived at Karachi on 9th of June, 1988, however bill of entry for clearing the vessel from the Customs was filed on 23-6-1988. It may be seen that on 16th January, 1989 Collect orate of Customs at Gadani required petitioner to pay income tax being chargeable on account of the fact that bill of entry was filed prior to 30-6-1988.
3. It may be seen that Central Board of Revenue on 25-6-1981 had issued Notification being S R 0 658 (1) /81 specifying types of persons who were exempted from paying advance income Tax. For ready reference same is reproduced below: " S.R.O. 658 (1)
181. Dated 25-6-1981.--In exercise of the powers conferred by the proviso to subsection (5) of Section 50 of the Income Tax Ordinance, 1979 (XXXI of 1979) hereinafter referred as the Ordinance, and in supersession of its Notification No S.R.O. 737 (I), 80, dated the 10th July, 1980, the Central Board of Revenue is pleased to direct that the following be the classes of persons to whom the said subsection shall not apply, namely:-
(i) a Provincial Government;
(ii) a local authority;
(iii) foreign companies and other associations whose share capital is substantialy held by a foreign government;
(iv) persons who import plant, machinery, fixtures, fitting or any other equipment for the purpose of setting up an industrial undertaking (including hotels) approved by the Federal Government in respect of such plant, machinery, fixtures, fittings, or any other equipment;
(v) persons who import plant or machinery for execution of a contract with the Federal Government or a Provincial Government and produce a certificate from the Government concerned to this effect;
(vi) persons who produce a certificate for the Commissioner of Income Tax concerned to the effect that their income during the income year is exempt from tax or is not likely to be chargeable to tax;
(vii) companies importing high speed diesel oil, light diesel oil, high octance blending component or kerosene oil in respect of such imports; and
(viii) companies importing crude oil for refining and chemicals used in refining thereof in respect of such imports.
(2) The notification shall be effective from the first day of July, 1981.
' However on 26-6-1988 Central Board of Revenue issued another Notification No, SRO-535 (1)/88 adding new category of persons who would be exempt from paying advance Income Tax to Customs Department. Same is also produced here: "S.R.O. 535 (1)/88, dated 26-6-1988.--In exercise of the powers conferred by the proviso to subsection (5) of Section 50 of the Income Tax Ordinance, 1979 (XXXI of 1979), the Central Board of Revenue is pleased to direct that the following further amendment shall be made in Notification No, S.R.O. 658 (I)/81, dated the 25th June, 1981, namely;-
(2) In the aforesaid notification, after clause (viii) the following clause shall be added, namely:-
(ix) a person who is liable to pay advance tax under Section 53 during the financial year in which the goods are imported provided that he furnishes to the Collector of Customs a certificate from the concerned Commissioner of Income Tax to this effect stating therein his National Tax Number."
(3) This Notification shall be effective from the First day of July, 1988."
' It is the case of petitioner that Commissioner, Income Tax Karachi vide No, COS/11-Jud- I/3/88/89/248 dated 26-9-1988 has granted exemption upto 30-121988 from deduction of Income Tax by Custom within the meaning of Section 50 (5) of the Customs Act. Again letter No, COS/11- Jud-I/VI/3/88/89/447 dated 19-1-1989 extended the exemption period upto 30-6-1989.
' Mr. Muhammad Ali Saeed, learned counsel for petitioner vehemently urged that, Collectorate of Customs was merely concerned with collection of `advance income tax' on behalf of Income Tax Department under section 53 of the Income Tax Ordinance, 1979. Since section 50 (5) of the 'Income Tax, Ordinance' clearly envisages procedure for granting exemption to class of persons who furnish certificate of the 'Commissioner Income Tax, therefore, on supplying requisite certificate, Customs Authorities could not cause deduction of the advance tax. He further maintained that determining factor about date of recovery of advance Income Tax would be regulated from delivery of goods to the petitioner, and not the date of import or submission of bill of entry. It was thus submitted that section 30 or 79 of Customs Act is not relevant for considering recovery of 'Advance Income Tax'; because these provisions merely relate to the manner of levying Customs duty etc. It was also urged that recovery of 'advance Income Tax' does not constitute as 'Tax Due' rather it suggests recovery of advance liabilities towards Income Tax which is yet to fall due subsequently and would have to be subject-matter of determination in future. He canvassed that aforementioned notifications of the Customs Department were incorrectly interpreted by the respondent while directing recovery of Income Tax, in the instant case.
' Whereas on the other hand Mr. Muhammad Riaz Ahmad counsel for the State, opposing the petition strenuously contended that criteria for affecting recovery of the advance Income Tax co- relates with the date of import. According to him, normally an assessee of income tax furnishes income tax return in the ensuing year by showing the import item during preceding year therefore normally the income benefit, of petitioner on the basis of vessel imported by him in June, 1988 ought to have been mentioned/specified in the returns of financial year ending by June 1988.
Therefore, advance tax was rightly demanded by the Customs authorities. It was not disputed that Custom Department is merely agency on behalf of Income Tax Department, but learned counsel maintained that respondents had statutory obligation to effect said recovery in accordance with law. He submitted that petitioner by adopting various tactics are trying to evade payment of taxes, as such petition is not maintainable.
4. We have considered the arguments addressed by the learned counsel for parties. Basic question which needs consideration would be whether Customs authorities could lawfully direct recovery of 'Advance Income Tax' at the rate of 1-1/2 % chargeable ad valorem, in respect of Vessel 'GARAGE- RARAKA-1" imported by the petitioner on 9-6-1988 for the clearance whereof bill of entry was submitted on 23-6-1988 but delivery was made later specially when certificate of exemption within the purview of section 50 (5) of Income Tax Ordinance, 1979 was issued by Commissioner Income- tax. No doubt Collectorate of Customs under the provisions of Income-tax Ordinance, 1979 merely acts as an agent of recovery of advance tax as contemplated under section 53 of Income Tax Ordinance, 1979, however controversy concerning competency of Income Tax Commissioner to grant exemption from making deduction of advance tax on the basis of Notification S.R.O. No, 535 (I)/88 dated 26-6-1988 in respect of vessel subject matter of petition needs to be resorted. Perusal of various provisions of law indicate that section 30 (1) read with section 79 apparently deals with determination of Customs duty and other taxes, imposed on the goods imported for home consumption, and specifies the date which forms terminus quo for said purpose. It may be noted that ultimate relief sought in the petition aims at exemption of In- come tax but concerned department is not impleaded in petition. Besides it is not mentioned whether Income pertaining to imported vessel was shown in the returns of financial year 1987/1988 or would be shown in the year commencing from Ist of July, 1989. Customs authorities are bound to adopt uniform procedure for deducting the Income Tax. Since from its nature, deduction of Income Tax is 'advance' therefore prima facie recovery of dues had to correlate with date of its import at best on furnishing bill of entry. In our view it is further supplemented by the fact that notification issued by Income Tax Department dated 26-6-1988 introducing Clause (ix) of Section 50 (5) of Income Tax Ordinance 1979, referred to above, contains facility of exemption for advance deduction during financial year in which goods are imported. In the circumstances possibly benefit of the exemption clause can be suitably obtained by the petitioner, of imports only during the year when goods are factually imported. Besides aforesaid notification has been made effective prospectively from Ist day of July, 1989; whereas admittedly the vessel in question was received during June, 1988, therefore, in our opinion benefit of exemption clause on the basis of certificate of Commissioner Income Tax could be availed only during the year that goods were imported accordingly we are persuaded to hold that deduction was rightly ordered to be made by the respondent.
' Anyhow, now deposits have been made in the Court, petitioner can conveniently seek release of amount on getting clearance of Income Tax Department on determination of annual assessment of the return, and thereafter obtain refund of the amount as per rules. Accordingly we do not find any merits in the petition which is dismissed with no order as to costs.