Sugar mills: LHC allows FBR to recover SED

Upholding the decision of the single bench, a division bench of the Lahore High Court on Monday allowed the Federal Board of Revenue (FBR) to recover Special Excise Duty from sugar mills of Sharif family and others. Dismissing 16 intra court appeals, the bench ruled that since the bill was passed by the parliament FBR is fully authorised to recover special excise duty during this period.
Previously, the court had restrained FBR from taking coercive measures against three sugar mills for the recovery of special excise duty. The appeals were filed by Ittefaq, Brothers and Ramzan sugar mills of Sharif family and others. Representing the sugar mills, Advocate Ijaz Awan pleaded that on June 29 2007 the Ministry of Finance issued a notification relating to federal excise S.R.O. 655(I)/2007 whereby Special Excise Duty (one per cent of the value) was levied without having lawful jurisdiction.
He said the government wrongly exercised the powers conferred by section 3-A of Federal Excise Act, 2005. He argued that section 3-A was not part of Federal Excise Act, 2005 at the time and date when the impugned SRO (notification) was issued as it was inserted subsequently vide an Act of parliament.