GOVERNMENT OF PAKISTAN
MINISTRY OF FINANCE AND ECONOMIC
AFFAIRS
NOTIFICATION
Islamabad, the 13th June, 1997
CUSTOMS
S.R.O.
431 (I)/97.- In
exercise of the powers conferred by section 19 of the Customs Act, 1969 (IV of
1969), the Federal Government is pleased to exempt components,, sub-assemblies
and assemblies and other items of machinery, as are not manufactured locally,
if imported by a local manufacturer for the manufacture and supply of complete
units or plants from levy of the whole of customs-duties leviable under the
First Schedule to the Customs Act, 1969 provided the rates applicable to
equipment and machinery when imported as part of a complete industrial plant
(as listed below) by contractors/project sponsors, etc is 10% or less. Where such duty is higher than 10% then the
exemption in custom-duty shall be limited to a maximum of 10%. The concession in duty shall be subject to
the following conditions, namely:-
(i) The manufacturer is recognized prime manufacturer cum supplier of such plants, and has suitable in-house facilities for design, engineering and progressive manufacture of such units or plants in respect of which he claims exemption under this notification;
(ii) the items of machinery allowed for concessionary import under this notification shall be in accordance with the Industry Specific deletion programme (wherever applicable) chalked out, in accordeance with the laid down procedure, for such industrial plants spreading over a maximum period of five years. The local manufacturer shall be required to achieve the minimum level of deletion of the related industrial plant and the continued availability of the exemption under this notification shall be contingent upon -
(a) the achievement of progressive annual deletion as approved by the Engineering Development Board; and
(b) the use of locally manufactured deleted items.
(iii) the manufactuer shall furnish to Chief, Survey and Rebate, Central Board of Revenue, or any officer authorized in this behalf, duly approved by the Engineering Development Board, the list of items that he is manufacturing or intends to manufacture alongwith the details of components, sub-assemblies and assemblies and other items of machinery required and the Chief or such authorized officer, in consultation with the Collector of Customs and Central Excise, will notify total requirements of various types of components, sub-assemblies and assemblies and other items of machinery alongwith the quantity required for such industrial plant;
(iv) the manufacturer shall, at the time of import of components, make a written declaration on the bill of entry to the effect that the components, sub-assemblies and assemblies and other items of machinery, as the case may be, have been imported in accordance with his entitlement in terms of conditions (i) and (ii);
(v) at the time of import the manufacturer shall furnish to the Collector of Customs an indemnity bond and post-dated cheque of the amount equivalent to the customs-duties exempted to abide by the conditions laid down in this notification failing which he would pay the customs duties leviable on each consignment in addition to any penalty that may be imposed by the Collector of Customs in this behalf;
(vi) the manufacturer shall maintain record of inputs (i.e. the components, sub-assemblies and assemblies and other items of machinery and goods manufactured or assembled out of them in such Form as may be required by the Central Board of Revenue;
(vii) the manufacturer shall, within one year of the date of filing of bill of entry for home consumption or ex-bond bill of entry relating to the components, sub-assemblies and assemblies and other items of machinery, apply to the Collector of Customs for discharging the bond, the application being supported by a certificate in the form set out below, issued by the Assistant Collector, Customs and Central Excise within whose jurisdiction the manufacturing unit is located;
(viii) in case Assistant Collector, Customs and Central Excise, is not satisfied regarding the consumption of imported components, sub-assemblies, assemblies and other items of machinery, or use of locally produced deleted components, sub-assemblies, assembliesand other items of machinery, he shall report his findings to the Collector of Customs concerned who shall initiate proceedings for encashment of post-dated cheque and penal action for giving false declaration;
(ix) the manufacturer shall maintain a record of complete industrial plants with break-up of the sale of the manufactured goods and the imported goods in the form set out below and shall produce, on demand, such record and other evidence of sales as may be required for inspection by an officer of Customs not below the rank of Assistant Collector of Customs in whose jurisdiction the manufacturing unit is located or any other officer authorized by the Central Board of Revenue in this behalf; and
(x) the vendors, if directly linked with the prime manufacturer cum supplier, shall also be entitled to avail exemption of custom-duties under this notification subject to fulfilling all the above requirements to the satisfaction of Central Board of Revenue and Engineering Development Board.
Explanation.- For the purposes of this notification the expression "not manufactured locally" shall mean the goods which are not included in the list of locally manufactured goods, specified in the General Order, issued by the Central Board of Revenue.
TABLE
S.No. Description of industrial plants or
units.
1. Sugar mill upto 10,000 tcd capacity
per unit
2. Cement plant upto 4000 tpd capacity
per unit
3. Certain types of chemical palnts
for the production of industrial chemicals
4. Thermal power plant upto 350 MW
capacity per unit
5. Hydel Power Plant upto 50 MW
capacity per unit
6. Certain types of oil and gas
development plant
7. Any other industrial plant
recommended and approved by Engineering Development Board and the Central Board
of Revenue.
(C.No.6(9)-CB/97)
RIAZ AHMAD MALIK
Additional Secretary
As amended
S.R.O.720(I)/99, - dated 12.06.1999