M. IQBAL & SONS vs FEDERATION OF PAKISTAN S — 2025 PTD 1755 KARACHI-HIGH-COURT-SINDH

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M. IQBAL & SONS VS FEDERATION OF PAKISTAN S. 13---SRO 1125(I)/2013 dated 31.12.2011---SRO 1070/(I)/2017 dated 23.10.2017---SRO 777(I)/2018 dated 21.06.2018---Benefits to five export oriented industries including leather---Artificial leather, import of---Sales tax, exemption/reduction of---Scope---Whether the imported "Artificial leather" was covered under SRO 1125(I)/2013 dated 31.12.2011 ('SRO 1125') for exemption and reduction on sales tax under the head of Leather Industries---Respondents / Department denied the exemption to the petitioners / importers on pretext that by virtue of later amending notifications Artificial Leather was not covered under the heading of Leather as provided in SRO 1125---Validity---When the original conditions to the SRO 1125 are read with the subsequent amendments through SRO 1070 (I)/2017 dated 23.10.2017 ('SRO 1070'), no material change as to the issue in hand is seen and there is no justification in change/ shift in respect of interpretation of the word "Leather Industry" now being relied upon by the respondents; it was the same since inception and until 2017, when through SRO 1070 only some rationalization of rates and value addition of sales tax at import and manufacturing stage against Textile and Leather Industry was made; and such rationalization was not made in respect of three other categories of the Industries, i.e. Carpets, Sports and Surgical Goods---There was not any other change in the original SRO through promulgation of SRO 1070---The exemption / reduction granted to "Leather Industry" would also be available to "Artificial Leather" as it is not restricted in SRO 1125 only to "Natural Leather", which was misunderstood by the Respondents/Department having no basis or justification to deny such exemption, which admittedly, was never disputed by them since 2011 till 2017 when SRO 1070 was issued---Nonetheless, subsequently the Board has issued SRO 777 (I)/2018 dated 21.06.2018 ('SRO 777'), whereby, against relevant Serial/Column, the exemption including "Artificial Leather" has been inserted---Even otherwise, since the SRO 777 is clarificatory in nature and has been issued pursuant to representations of the petitioners, whereas, the controversy in this regard was pending before FBR as well as High Court, since 16.11.2017, the petitioners would be entitled to the benefit of this amending SRO 777 by giving it retrospective effect to the cases in hand as a notification which confers a benefit or right to a person can be given retrospective effect, whereas the notification which disturbs or impairs a vested right of a person or creates a new liability cannot be applied retrospectively in absence of a legal sanction to that effect---High Court declared that the consignments in question imported by the petitioners were entitled to exemption as claimed in terms of SRO 1125(I)/2011 dated 31.12.2011---Constitutional petitions, filed by importers, were allowed.

M. IQBAL & SONS vs FEDERATION OF PAKISTAN S — 2025 PTD 1755 KARACHI-HIGH-COURT-SINDH

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