' SALEEM AKHTAR, J.---These petitions shall be disposed of by this judgment as common questions of fact and law are involved. The petitioner after obtaining import licence and opening letter of credit imported machinery for the purpose of modernising and balancing its existing units. Such machinery was exempted from whole of the customs duty chargeable thereon. The petitioner filed bill of entry for bond in respect of the imported machinery and claimed exemption from the whole of the customs duty in terms of S R 0 512 (1)/86 including the additional customs duty of 5% payable under the Finance Ordinance of 1982 and the additional customs duty of another 5% payable under the Finance Act, 1985. Exemption from the sales tax of 12-1/2% was also claimed. The principal Appraiser admitted the said machinery to exemption from whole of the customs duty but refused to grant exemption from additional duties levied under the Finance Ordinance, 1982 and Finance Act, 1985 as well as sales tax. Petitioner has challenged the levy of these duties as without lawful authority.
' Mr. Khalid M. Ishaq the learned counsel for the petitioner has contended that in view of section 31- A of the Customs Act which charges duties mentioned therein section 2 of Finance Ordinace, 1982 and section 5 of Finance Act, 1985 should be ignored and no reference can be made to them. It was further contended that as assessment of duty is to be made under the Customs Act exemption under section 19 will be applied in respect of the entire duty calculated under section 31- A. In order to appreciate the contention of the learned counsel it is necessary to refer to the various enactments involved in it. By Ordinance, 1982 an additional customs duty as surcharge was levied on the importation of goods specified in the First Schedule to the Customs Act 1969. By an amending Ordinance, 1983 it was amended and the amended section 2 reads as follows:- "Surcharge on imported goods:-.There shall be levied and collected an additional customs duty as surcharge on the importation of the goods specified in the First Schedule to the Customs Act, 1969 (IV of 1969), at the rate of five per cent of the value of the said goods as determined under section 25 of the said Act: Provided that for the purposes of the Sales Tax Act, 1951 (III of 1951), the additional customs duty shall not constitute a part of the duty paid value.
2. The Federal Government, subject to such conditions, or restrictions, if any, as it thinks fit to impose, may, by notification in the official Gazette, exempt any goods imported into Pakistan, from the whole or any part of the additional customs duty leviable under subsection (1) and no exemption from payment of customs duty under the Customs Act, 1969, or any other law for the time being in force shall apply to the additional customs duty leviable under the said subsection."
Further by section 5 of the Finance Act, 1985 Iqra surcharge on imported goods was levied in the following manner:-
5. Iqra surcharge on imported goods:-(1) There shall be levied and collected an additional customs duty as Iqra surcharge on the importation of the goods specified in the First Schedule to the Customs Act, 1969 (IV of 1969), at the rate of five per cent of the value of the said goods as determined under section 25 of the said Act: Provided that, for the purposes of the Sales Tax Act, 1951 (III of 1951), the additional customs duty shall not constitute a part of the duty paid value.
(2) The Federal Government, subject to such conditions, limitations, or restrictions, if any, as it thinks fit to impose, may by notification in the official Gazette, exempt any goods, imported into Pakistan from the whole or any part of the additional customs duty leviable under subsection (1) and no exemption from payment of cutoms duty under the Customs Act, 1969, or any other law for the time being in force shall apply to the additional customs duty leviable under the said subsection."
In Al-Samrez's case (1986 SCMR 1917) it was held that any notification withdrawing any exemption or prescribing higher rate of duty cannot be given effect to in respect of imports which were arranged and finalised and vested interest had been created before the issuance of such notifications. Thereafter in order to obviate its effect section 31-A was added in the Customs Act by Finance Act 1988 which reads as follows:- "31-A. Effective rate of duty.-(1) Notwithstanding anything contained in any other law for the time being in force or any decision of any Court, for the purposes of sections 30 and 31, the rate of duty applicable to any goods shall include any amount of duty imposed under section 18, section 2 of the Finance Ordinance, 1982 (XII of 1982), and section 5 of the Finance Act, 1985 (I of 1985), and the anti-dumping or countervailing duty imposed under the Import of Goods (Anti-dumping and Countervailing Duties) Ordinance 1983 (III of 1983), and the amount of duty that may have become payable in consequence of the withdrawal of the whole or any part of the exemption or concession from duty whether before or after the conclusion of a contract or agreement for the sale of such goods or opening of a letter of credit in respect thereof.
(2) For the purpose of determining the value of any imported or exported goods the rate of exchange of which any foreign exchange is to be converted into Pakistan currency shall be rate of exchange in force:
(a) in the case of goods referred to in clause (a) of section 30, on the date referred to in that clause;
(b) in the case of goods referred to in clause (b) of the aforesaid section, on the date referred to in that clause; and
(c) in the case of goods referred to in section 31, on the dates referred to in that section."
Mr. Khalid M. Ishaq's contention is that as all these additional duties have been incorporated in section 31-A resort to section 2 of the Finance Ordinance, 1982 and section 5 of the Finance Act, 1985 reproduced above for the purposes of granting exemption need not be made. According to the learned counsel the exemption granted under section 19 shall apply and the aforestated provisions of Finance Ordinance, 1982 and Finance Act 1985 should not be looked into. Section 31-A is not a charging section. It is merely a machinery section envisaging the manner in which the duty is to be calculated and in that process the levies made under the aforestated provisions have also been included. However, the additional customs duty and Iqra Surcharge are to be calculated in accordance with provisions of Section 2 of the Finance Ordinance, 1982 and Section 5 of the Finance Act, 1985. They clearly provide that for the purposes of these duties and surcharges the Federal Government can by notification exempt any goods imported into Pakistan, from whole or any part of the duty leviable under these sections. They specifically exclude the applicability of section 19 of A the Customs Act. Therefore, any exempting granted under section 19 of the Customs Act will not be attracted while charging duty under section 2 of the Finance Ordinance, 1982, and section 5 of the Finance Act, 1985. The petitioner is therefore, not entitled to the relief claimed by it.
Petitions are therefore, dismissed.
Petitions disniissed.