GOVERNMENT OF PAKISTAN

MINISTRY OF FINANCE, ECONOMIC AFFAIRS,

STATISTICS & REVENUE

(REVENUE DIVISION)

* * *

Islamabad, the 14^th January, 2002

(CUSTOMS) 

S.R.O. (I)/2002:- In exercise of the powers conferred by section 19 of the Customs Act, 1969 (IV of 1969), and subject-section (1) of the Sales Tax Act, 1990, the Federal Government if pleased to direct:-

1. that plant and machinery, if not manufactured locally, shall be exempt from whole of customs duty and sales tax if imported for setting up industries excluding those specified in table below in the Special Industrial Zone whose locations and perimeters have been notified by the Board of Investment vide Notification No. SRO 1198(I)/95, dated the 24^th December, 1995; and
2. all such industries shall be exempt from whole of customs-duty and sales tax with effect from the 17th ^June, 2000, on import of plant and machinery, provided the letters of credit for the plant and machinery are opened up to the 30^th June, 1996, and commercial operations are commenced up to the 31^st December, 2002, subject to the following conditions, namely:-

1. Nothing in this notification shall effect or in any way prejudice the industrial units whose cases are subject-judice and the Federal Government shall decide such cases in accordance with verdict of the apex Court;
2. The importer shall, at the time of import of machinery, make a written declaration o the bill of entry to the effect that machinery has been imported for a project located in an area specified i the Special Industrial Zone;
3. The importer shall furnish an indemnity bon in the form as set out below to the extent of customs duty and sales tax exempted under this notification. The said bond shall not be discharged till the expiry of one year after the commissioning of the project which fact should be duly verified by the Project Director of the Special Industrial Zones and the Assistant Collector of Customs and Central Excise in whose jurisdiction the project is located. Such certificate of verification shall clearly state that the plant and machinery imported for the purposes specified in the bills of entry have been duly installed; and
4. In the event of non-production of such certificate by the importer the Collector of Customs shall enforce the indemnity bond and proceed to recover Government dues under section 202 of the Customs Act, 1969, and the rules made thereunder.

Explanation:For the purpose of thisnotification,"plantandmachinery"shallmean-

1. machinery operated by power of any description, such as is used in any industrial process including machinery for mining and extraction of timber.
2. Apparatus and appliances including metering and testing apparatus and appliances specially adapted for use in conjunction with machinery and equipment specified in item (1) above;
3. Mechanical and electrical control and transmission gears adopted for use in item (1) above; and
4. Component and parts up to five percent of the initial C&F value of machinery as specified in items (1) and (2) above, identifiable as for use in or with such machinery.

(On appropriately stamped non-judicial paper)

THIS DEED OF INDEMNITY IS MADE ON THE _____________ day of ______________ BETWEEN Messers ______________________ having registered office at ______________________ (hereinafter called "the importer" which expression includes his successors, administrators, executors and assignee) of the one part, AND the President of Pakistan through the Collector of Customs __________________ (hereinafter called "the Collector of Customs" of the other part):

WHEREAS the Federal Government has, vide Notification No. SRO _____________, dated _______________ (hereinafter called the "importer") have imported the plant and machinery mentioned in the Schedule to this Bond for the purpose of setting up industries in accordance with the conditions given in the said Notification.

NOW, THEREFORE, in consideration of the release of the machinery without recovery of customs duty and sales tax, the importer bind himself to pay on demand to the Government of Pakistan a sum of Rs. ______________ being the customs duty and sales tax leviable on the machinery, if the importer fail: -

1. to produce a certificate from the Project Director, Special Industrial Zone and the Assistant Collector of Customs & Central Excise, within one year from the date of the importation from the plant and machinery, to the effect that the plant and machinery have been installed at a place in any of the Special Industrial Zone; or
2. to produce such evidence as it may be necessary to establish that the plant or machinery have been installed in accordance with the conditions of the said Notification.

The importer further agrees and bind himself that the amount covered by this Bond may be recovered as arrears of customs duty under section 202 of the Customs Act, 1969.

The importer shall stand discharged from any liablity under this Bond when the aforesaid certificate has been produced and it is established thorugh other evidence, if necessary, that the importer has fulfilled all the conditions of this Bond.

Signed by importers on this ______________ day of ______________ 20

________________________

(Managing Director)

(Name & permanent address)

Witness: __________________________________________________

(Signature, name, designation and full address)

Witness: __________________________________________________

(Signature, name, designation and full address)

Note: This Bond shall be witnessed by a Government servant in BPS 16 or above.

__________________________________________________________________________________________

[C.No. 1/9/Mach/92]