MOL PAKISTAN OIL AND GAS vs FEDERAL BOARD OF REVENUE Ss — 2025 PTD 876 ISLAMABAD

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

MOL PAKISTAN OIL AND GAS VS FEDERAL BOARD OF REVENUE Ss.2(41) & 3---Customs act (IV of 1969), First Schedule---SRO 549(I)/2008 dated 11-06-2008, Sr. No. 4(xvii)---Taxable supply---Petroleum---Crude oil---Import and supplies---Zero-rating---'Condensate' as 'crude oil'---Scope---PCT Heading---Scope---appellate Tribunal Inland Revenue concluded/ concurred with the version of the Department that 'condensate' was not part of the same family of petroleum oils as 'crude oil'---Case of the applicants (companies engaged in the business of exploration /production/sale of petroleum and natural gas) was that condensate was to be meted out the same treatment of zero-rating because it was also crude oil for the purposes of the PCT heading 2709.0000---Claim of the Department was that the PCT heading was only for identification and, even though PCT 27.09 includes gas condensate and even though SRO 549 identified the zero rated good in question with reference to PCT 27.09, the condensate should nonetheless be excluded---Whether condensate and crude were distinct or the same products?---Held, that the Federal Government could have mentioned petroleum crude oil only while issuing SRO 549(I)/2008 dated 11-06-2008 ('the SRO 549'), but it chose to identify the goods with reference to the PCT heading 2709.0000---Mentioning of the PCT heading necessitated its proper consideration while construing serial No. 4(xvii) in SRO 549 and the preceding expression 'petroleum crude oil' neither could nor ought to be read in isolation without reference to the PCT heading---The department's stance that the PCT heading was only for identification was not persuasive; in identification laid the delineation of what was being identified---If the description in the PCT heading was meant to be ignored, then the reference to the PCT heading in serial No. 4(xvii) would be rendered a surplusage, running counter to the principle that redundancy was not to be ascribed to any provisions in a statutory instrument---The PCT headings are the HS Code (Harmonized System Codes) or PCT Codes (Pakistan Customs Tariff Codes) for the classification of goods ; their very purpose is to identify any given goods under consideration , enabling a globally accepted classification and identification system of goods---The Finance act, 1994, amended the Customs act, 1969, to add the 'General Rules for Interpretation' in the First Schedule of PCT headings to the Customs act, which, under the sub-heading 'Pakistan Rules', read as "For the purposes of "Explanatory Notes to the Harmonized Commodity Description and Coding System" published by World Customs Organization, Brussels, as amended from time to time , shall be considered authentic source of interpretation"---When the Explanatory Notes - being authentic source of interpretation - categorised all crude oils under PCT 27.09, including gas condensate, the Sales Tax Department could not exclude condensate---This claim/argument might have held water if PCT 27.09 was not mentioned in SRO 549, but it was indeed mentioned, that it became an indivisible part of serial No. 4 (xvii), and that PCT 27.09 expressly regarded condensate a "crude oil"---It is common wisdom to interpret and construe technical expressions according to the meaning carried by such expressions in a given trade or industry, and in such case the general principle of giving the words their ordinary dictionary meaning is displaced---The expression "import and supplies thereof" was to be interpreted with reference to the definition of "taxable supply" in S.2(41) of the Sales Tax act and was to be interpreted disjunctively---Thus, the proposed questions were answered in the affirmative, i.e. in favour of the taxpayers and against the Department---Sales tax reference applications, filed by taxpayer, were allowed.

MOL PAKISTAN OIL AND GAS vs FEDERAL BOARD OF REVENUE Ss — 2025 PTD 876 ISLAMABAD

Case information

Judgment text as reported

Other judgments reported in 2025 PTD