SRO.565(I)/2006: FBR tells LTUs and RTOs to hand over record
The Federal Board of Revenue has directed the Chief Commissioners of Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) to immediately hand over all the record including audit reports of importers-cum-manufacturers to the Collectors of Customs under SRO.565(I)/2006. The FBR has issued instructions to the field formations, here on Thursday.
Earlier, the FBR had issued draft instructions to the Collectors of Customs for comments. Now, the Board has finalised the instructions on the SRO.565(I)/2006 and circulated the same to the Collectors of Customs and LTUs/RTOs, incorporating their viable suggestions.
According to the FBR instructions, all the Chief Commissioners of Inland Revenue LTUs/RTOs would provide all the record pertaining to import authorisations issued under SRO.565(I)/2006 dated June 6, 2006 as well as pending audit reports to the relevant Collectorates of Customs. The Chief Commissioners Inland Revenue LTUs/RTOs would also forward the pending/fresh requests for issuance of import authorisations to respective Collectorates of Customs for processing thereof.
The FBR has issued separate instructions to the Project Director WEBOC Karachi, customs clearance system to take necessary action with regard to quota debiting of importers-cum-manufacturers and any other related issues under SRO.565(I)/2006. The FBR has also issued instructions to the Engineering Development Board (EDB) that all correspondence regarding determination of input/output and wastage determination in terms of SRO565(I)/2006 be addressed to the respective Collectorates.
According to the FBR’s instructions to the field formations dated June 27, 2012, the SRO 565(I)/2006 dated June 5, 2006 has been amended vide SRO 573(I)/2012 dated June 1, 2012. The said amendment entails, inter alia, changes in the regulatory mechanism of the SRO: under new dispensation, Collectors of Customs have been empowered to perform additional functions like determination of annual entitlement of inputs, extension in cases of non-consumption within a year and auditing of the record of importers-cum- manufacturers. These functions were previously performed by Collectors of Sales Tax and Federal Excise. In order to ensure that no hardship is caused to importers-cum-manufacturers there is a need for smooth switch-over for which the FBR has decided to issue guidelines for the field formations.
Sources said that all Collectors of Customs shall be the regulatory Collectors in their respective jurisdictions as per SRO 967(1)/2007 dated September 20, 2007 except in Karachi where Collector of Customs Appraisement shall be regulatory Collector for importers-cum-manufacturers operating businesses throughout Karachi. The FBR has advised the Collectors of Customs to set-up a dedicated Cell under the supervision of an Assistant Collector/Deputy Collector for smooth working of new regulatory regime so as to ensure that no inconvenience is caused to the importers-cum-manufacturers on account of change in the regulatory regime.
An importer-cum-manufacturer who intend to import input goods on concessionary rates as per provisions of SRO 565(1)/2006 shall file an application to the Collector of Customs having jurisdiction along with requirements under conditions of the SRO duly supported by documents such as list of machinery installed along with its catalogues, brochure or drawing, its production capacity and copy of the ownership deed or lease documents of the manufacturing premises, the FBR said.
All applications received in this regard by the Collector of Customs or an officer authorized by him shall be allotted progressive serial numbers and duly examined for determination as to whether the importer is entitled to the declared concessions or not.
In cases of importers-cum-manufacturers whose annual entitlements of inputs have been fixed by Collectors of Sales Tax (LTUs/RTOs), concessionary import of inputs shall be allowed as per their entitlement and the same shall be renewed in terms of the said SRO within a period of 120 days. However, in fresh cases, the Collectors of Customs may determine annual entitlement of inputs on the basis of input-output ratio and wastage determined by Engineering Development Board (EDB) and Input Output Coefficient Organisation (IOCO) or any other recognised authority, FBR maintained.
The Collector of Customs shall ensure that the imported inputs have been consumed in accordance with the determined scale for manufacture of specified goods, through desk audit, and in case discrepancies are discovered, a detailed audit shall be got conducted, FBR said. In case of any default/misdeclaration in respect of input/output goods, entitlement or wastage on part of importer-cum-manufacturer, necessary action under the law shall be initiated by the respective Collector of Customs.
The FBR’s instructions further stated that the Collector of Customs may, during authorized consumption period, get the stocks of input materials or finished products verified either through advance intimation to the concessionaire or otherwise for reasons recorded in writing ensuring that all such verifications are reported immediately on completion to the concerned Chief Collectors of Customs.
The Director, Directorate of IOCO shall respond urgently to the request of Collector Customs for determination of fresh input-output ratio and wastage, if any, or shall notify to the Collector if such ratios have already been fixed by the Directorate, FBR said.
The Collector of Customs shall release the inputs against post dated cheque. The importer-cum-manufacturer shall undertake before Collector of Customs on their letter head duly attested by customs clearing agent that they will abide by the provisions of SRO and that there shall be no misuse of the concessions available under the SRO, the FBR instructions added.
Copyright Business Recorder, 2012