Withdrawing a major facilitative provision of the Customs Act, 1969, the importers would be unable to obtain written reply from customs department for not accepting the 'declared value' of imported consignments for valuation purposes during 2007-08.
Sources told Business Recorder on Friday that it is practically impossible for the customs officials to convey the grounds for non-acceptance of the declared value in writing involving a large number of cases. Customs has to process all such cases on daily basis for submitting written replies to the importers for not accepting the declared values.
The board has abolished this condition through Finance Act, 2007, which has become applicable from July 1. For this purpose, the words appearing in sub-section (4) of section 25 of the Customs Act, the words "in writing" have been substituted due to non-practicability of application of this provision. Its binding nature has been dilute to overcome objections of the courts whereby recorded evidence is demanded by the courts in such disputes.
Sub-section 10 of Section 25 provides for sequence to be followed for determining the customs value. The words "under this Act" have been omitted and mandatory provision of the section for applying sequential order has been re-worded to provide for "may" to give it non-binding effect.
Through Finance Act 2007, the FBR has made procedural changes in the determination of customs value under section 25A of the Customs Act. Under the Finance Act, collector of customs on his own motion or Director of Customs Valuation on a reference made to him by any person, may determine the customs value of any good or category of goods imported or exported after following method of section 25 of Customs Act. The customs value determined would be applicable customs value for assessment of the relevant imported or exported goods.
Sources said that prior to budget 2007-08 the board failed to effectively check under-invoicing due to absence of the powers of customs to fix values for different classes of goods. The values determined by the customs on the basis of information or date were also challenged before the courts, ensuing protracted litigation.
The powers to determine and notify value of different categories of goods has been given to customs in budget to counter the menace of under-invoicing. Through this change, customs would be able to notify values after regular intervals, especially for those items, which are prone to gross under-invoicing.
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