41 textile spinning mills declared as 'value-added industry'

To facilitate textile sector, the Central Board of Revenue (CBR) has declared 41 textile spinning mills as "value-added industry" and subsequently allowed 5 percent customs duty on the import of plant, machinery and equipment made by them prior to January 29, 2001.
Sources told Business Recorder here on Wednesday that the textile industry was declared as "value-added industry" on January 29, 2001, whereby textile units were permitted to import machinery/equipment at the concessional rate of 5 percent. However, the clearance made prior to January 29, 2001 was liable to statutory rate of duty. To remove this discrepancy, the CBR allowed 5 percent duty on the import of machinery/equipment made prior to January 29, 2001 by 41 textile spinning units.
The CBR has issued a special exemption order to facilitate these textile spinning units.
According to the notification, the CBR has exempted, as a special case, plant, machinery and equipment, not manufactured locally, imported by 41 textile spinning mills under SRO 27 (I)/98 of January 17, 1998 and SRO 369 (I)/2000 of June 17, 2000 under the category of "value-added industry" prior to January 29, 2001, from so much of the customs duty as is in excess of 5 percent ad valorem subject to fulfilment of other conditions as specified in these notifications.
Giving details, sources said that the textile mills were allowed provisional clearance of machinery/equipment on the recommendations of the Board of Investment (BoI). These mills made duty-free clearance on the condition that these mills would attain 40 percent value addition to be determined by a committee comprising representatives from BoI, Engineering Development Board (EDB), National Tariff Commission (NTC) and the CBR.
The committee convened several meetings and concluded that 41 textile spinning mills were unable to achieve value addition of 40 percent. In the meantime, the government declared textile sector as "value-added industry" permitting import of machinery/equipment at 5 percent duty. However, previous cases were liable to statutory rate of duty. Now, the issuance of special exemption order has brought the past cases at par with the concessional imports made after January 29, 2001.
The concessional rate of duty would be applicable on the import of machinery/equipment under SRO 27 (I)/98 and SRO 369 (I)/2000 by the following units prior to January 29, 2001: Olympia Spinning & Weaving Mills Ltd; Colony Textile Mills Ltd; Al-Hamad Textile Mills Ltd; Nafeesa Textile Mills Ltd; Premium Textile Mills Ltd; Ejaz Group of Companies; Fawad Textile Mills Ltd; Faisal Spinning Mills Ltd; Ayesha Spinning Mills Ltd; Sheikhupura Textile Mills Ltd; North Star Textile Mills Ltd; Kohat Textile Mills Ltd; Imperial Textile Mills Ltd; Suraj Cotton Mills Ltd; Choti Textile Mills Ltd; Khalid Shafique Spinning Mills Ltd; Friendship Textile Mills (Pvt) Ltd; Eastern Spinning Mills Ltd; Pride Spinning Mills Ltd; Chemi Dansk Company; Hajra Textile Mills Ltd; Umar Spinning Mills Ltd; Tayyab Textile Mills Ltd; Rastec Industries; Quetta Textile Mills Ltd; Brothers Textile Mills Ltd; Al-Azhar Textile Mills Ltd; Zahidjee Textile Mills Ltd; Rizwan Textile Mills Ltd; Khwaja Spinning Mills Ltd; Imran Spinning Mills Ltd; Sheikh Spinning Mills Ltd; Taqees (Pvt) Ltd; Artistic Denim Textile Ltd; Sapphire Textile Mills Ltd; Meko Textile (Pvt) Ltd; Sapphire Fires Ltd; Din Textile Mills Ltd; Sohail Textile Mills Ltd; Maqbool Textile Mills Ltd and Ahmed Hassan Textile Mills.