Carbon alloy wire rod: FBR says RD exemption cannot be granted on import

ISLAMABAD: The Customs Classification Committee of the Federal Board of Revenue (FBR) has declared that the exemption of Regulatory Duty (RD) cannot be granted on the import of small/medium carbon alloy wire rods.

In this regard, the committee has issued a detailed ruling on Thursday.

In the instant case, in the context of conditionality stipulated in SRO 903(1)/2021, lab reports and international standards, the impugned goods cannot be termed and specifically categorized and treated as high carbon wire rods, ruling added.

The Collectorate of Customs Appraisement-Port Muhammad Bin Qasim forwarded a reference for the determination of classification for entitlement of exemption of Regulatory Duty in terms of SRO 840(1)/2021 amended vide SRO 903(1)/2021 for goods, self-declared as “Prime Quality High Carbon Steel Wire Rods” under PCT heading 7227.9090.

The classification committee declared that it is quite evident that case matter is not related to tariff classification, rather it relates to the interpretation of SRO in view of conditional exemption of RD which has been subject to laboratory test that the imported items were high carbon wire rods. Both the representatives of the department and the importer also concurred with this observation of the committee.

The committee further observed that Valuation Ruling No I331/2018 was issued in terms of Section 25A of the Customs Act, 1969 whereby Customs values were determined for Iron or Non-Alloy Steel Wire Rod Low and High Carbon Draw Quality (PCT headings 7213.9190 & 7213.9990) on the basis of LMB prices and same is not related to classification of carbon wire rods on the basis of carbon content.

Brief facts of the case as reported by referring Collectorate are that the importer M/s Al-Majeed Ibrahim Steel Industries (Pvt) Ltd imported consignments, declared to contain “Prime Quality High Carbon Steel Wire Rods” for clearance thereof under PCT headings 7227.9090 by claiming exemption of RD under SRO 840(1)/2021 amended vide SRO 903(1)/2021.

In order to ascertain the admissibility of claimed exemption of Regulatory Duty, samples were forwarded to the Custom House Laboratory which reported the goods as “medium carbon alloy wire rod” on the basis of Carbon content 0.46% & 0.34%, contrary to description provided in SRO as a “high carbon wire rod”, therefore, exemption of Regulatory Duty was denied by the Collectorate.

Copyright Business Recorder, 2023