IN THE SUPREME COURT OF PAKISTAN 
(APPELLATE JURISDICTION) 
 
 
PRESENT: MR. JUSTICE MIAN SAQIB NISAR, HCJ 
 
 
MR. JUSTICE UMAR ATA BANDIAL 
 
 
MR. JUSTICE FAISAL ARAB 
 
 
CIVIL APPEAL NO.1079 OF 2011 AND C.M.A.2273/2013 
(Against the judgment dated 08.08.2011 of the High Court of Sindh, Karachi 
passed in C.P. No.1337/2010) 
 
 
Collector of Customs (Export) and others 
 
…Appellant(s) 
VERSUS 
Saifuddin 
 
…Respondent(s) 
 
For the appellant(s): 
Mr. Shakeel Ahmed, ASC 
 
 
For the respondent(s): 
Sardar Muhammad Aslam, ASC 
Ch. Akhtar Ali, AOR 
 
 
Date of hearing: 
17.5.2017 
… 
JUDGMENT 
 
 
MIAN SAQIB NISAR, CJ.- The facts of this appeal are that 
the respondent (seller) entered into various contracts dated 7.7.2009 with 
a British buyer for the export of copper, aluminum and brass scrap. The 
customs authorities charged regulatory duty at the rate of 25% ad 
valorem on such export vide notification dated 13.03.2010 (the notification) 
issued by the Federal Government in terms of Section 18(3) of the 
Customs Act, 1969 (the Act) which was to remain in force till 30.6.2010. 
The respondent successfully challenged the notification and the 
imposition of regulatory duty through a constitution petition before the 
learned High Court which held that irrespective of the notification, the 
respondent was not liable to pay regulatory duty. Leave was granted on 
7.12.2011 “to consider whether the High Court erred in law to hold that Section 31 
and 31-A excludes application of Section 131 of the Customs Act, 1969 for the purpose of 
calculation of duty and taxes for export purpose.” 
CIVIL APPEAL NO.1079 OF 2011  
-: 2 :-
2. 
 
Heard. To answer the key question as to whether the 
respondent was liable to pay regulatory duty upon the goods he exported, 
it must be seen whether regulatory duty was leviable under the law. In 
this regard, Section 18 of the Act is relevant which reads as under:- 
 
18. Goods dutiable.- (1) ……………………………………… 
 
(1A) 
…………………………………………………………… 
 
(2) 
No export duty shall be levied on the goods 
exported from Pakistan.  
 
(3) 
The Federal Government may, by notification in 
the official Gazette, levy, subject to such conditions, 
limitations or restrictions as it may deem fit to impose, a 
regulatory duty on all or any of the goods imported or 
exported, as specified in the First Schedule at a rate not 
exceeding one hundred per cent of the value of such 
goods as determined under section 25 or, as the case may 
be, section 25A.  
 
(4) 
The regulatory duty levied under sub-section (3) 
shall–  
(a) 
be in addition to any duty imposed under sub-
section (1) or under any other law for the time 
being in force; and  
(b) 
be leviable on and from the day specified in the 
notification 
issued 
under 
that 
sub-section, 
notwithstanding the fact that the issue of the official 
Gazette in which such notification appears is 
published at any time after that day.  
 
(5) 
………………………………………………………… 
 
(6) 
………………………………………………………… 
[Emphasis supplied] 
 
Section 18 of the Act is a charging section and sub-section (2) thereof 
provides that no export duty shall be levied on the goods exported from 
Pakistan. 
However, 
under 
sub-section 
(3) 
thereof, 
the 
Federal 
Government is authorized, by notification in the official Gazette, to levy a 
CIVIL APPEAL NO.1079 OF 2011  
-: 3 :-
regulatory duty on all or any of the goods exported, as specified in the 
First Schedule, subject to such conditions, limitations or restrictions as 
it may deem fit. Furthermore, the rate of the duty would not be more 
than one hundred per cent of the value of such goods, as determined 
under Section 25 or 25A of the Act. According to sub-section (4), the 
regulatory duty so levied, would be in addition to any duty imposed 
under sub-section (1) or under any other law for the time being in force 
and would be leviable on and from the day specified in the notification, 
notwithstanding the fact that it was published at any time after that day.  
3. 
 
In this regard learned counsel for the respondent argued 
that allowing the Federal Government to impose regulatory duty on 
exports under Section 18(3) of the Act would render sub-section (2) 
thereof redundant, and that the notifications issued by the Federal 
Government under Section 18(3) supra constitute subordinate legislation 
and would thus be subservient to sub-section (2) from which the 
intention of the legislature is clear, in that no export duty is to be levied 
on the goods exported from Pakistan. This is also the finding of the 
learned High Court in the impugned judgment. We disagree. It is worthy 
to note that sub-sections (2) and (3) of Section 18 of the Act are part of 
the same provision (Section 18) and were introduced at the same time, i.e. 
in 2005 vide Finance Act, 2005 (VII of 2005) when the erstwhile Section 
18 was substituted. Therefore, neither of the sub-sections could be said 
to be subordinate to the other. What is important is the intention of the 
legislature, which is to be gathered from a holistic reading of Section 18 
of the Act. While adopting the rule of harmonious interpretation of 
statutes, we find that sub-section (2) provides the general rule that all 
goods exported from Pakistan shall not be charged with export duty, 
whereas sub-section (3) provides the exception to such general rule, in 
that it specifically authorizes the Federal Government to impose a 
CIVIL APPEAL NO.1079 OF 2011  
-: 4 :-
regulatory duty, by notification in the official Gazette, on all or any of the 
goods imported or exported. A combined reading of both the sub-sections 
makes it abundantly clear that neither do they conflict with each other 
nor does either have supremacy over the other. ‘Regulatory duty’ has 
been examined in the judgment reported as Messrs Sh. Abdur Rahim, 
Allah Ditta Vs. Federation of Pakistan and others (PLD 198 SC 670) 
wherein the rationale for conferring the power to impose such duty was 
discussed. This Court held in the judgment (supra) that regulatory duty is 
meant to remove/check distortions in the market and to ensure stability, 
and that the Federal Government was validly delegated with the 
power/discretion to impose the same (regulatory duty). Therefore, the two 
sub-sections are consistent. Hence, the notification issued by the Federal 
Government under Section 18(3) of the Act imposing a regulatory duty on 
certain export items is valid and legal and such duty would be 
chargeable from the date of the notification, i.e. 13.3.2010 till 30.6.2010.  
4. 
 
In order to answer the question as to whether regulatory 
duty was in fact payable by the respondent, we need to examine the 
relevant date for determination of the rate of duty on exported goods. In 
this regard, Section 31 of the Act is relevant which reads as under:- 
 
31. Date for determination of rate of duty on goods 
exported.- The rate and amount of duty applicable to any 
goods exported shall be the rate and amount chargeable 
at the time of the delivery of the goods declaration under 
section 131: 
 
Provided that where the export of any goods is 
permitted without a goods declaration or in anticipation of 
the delivery of such a declaration, the rate and amount of 
duty applicable shall be the rate and amount chargeable on 
the date on which loading of the goods on the outgoing 
conveyance commences:  
 
Provided further that the Federal Government may, 
by notification in the official Gazette, for any goods or 
CIVIL APPEAL NO.1079 OF 2011  
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class of goods, specify any other date for determination of 
the rate of duty. 
[Emphasis supplied] 
 
As per this Section, the relevant time for determination of the rate of duty 
on goods exported is the date of the delivery of the goods declaration 
under Section 131 of the Act, which reads as below:- 
  
131. Clearance for exportation.- (1) No goods shall be 
loaded for exportation until-  
(a) 
the owner of any goods to be exported has made a 
declaration in such form and manner as 
prescribed by the Board, by filing a goods 
declaration to Customs containing correct and 
complete particulars of his goods, and assessed 
and paid his liability of duty, taxes and other 
charges, if any;  
(b) 
the claim of duty drawback, if any, has been 
calculated and reflected in the declaration filed for 
export through Customs Computerized System;  
(c) 
Customs has, on the receipt of goods declaration 
under clause (a), satisfied itself regarding the 
correctness of the particulars of export, including 
declaration, assessment, and payment of duty, taxes 
and other charges and verified the admissibility of 
the duty drawback claimed as specified in clause 
(b); and  
(d) 
the appropriate officer has permitted passenger‘s 
baggage 
or 
mail 
bags, 
to 
be 
exported 
notwithstanding clauses (a), (b) and (c).  
 
(2) 
………………………………………………………… 
 [Emphasis supplied]  
 
Section 131 ibid deals with the clearance of goods for exportation for 
which there are various elements [parts (a) to (d) of sub-section (1)] out of which 
one, i.e. sub-section (1) part (a), is that no goods shall be loaded for 
exportation until the owner has made a declaration by filing a goods 
declaration to the customs authorities. This is the sole element which 
Section 31 ibid refers to. From a plain reading of both Sections 31 and 
CIVIL APPEAL NO.1079 OF 2011  
-: 6 :-
131 [particularly sub-section (1)(a)] of the Act, it is manifest that the common 
feature is that of goods declaration and therefore duty shall be charged 
at the rate applicable on the date when the goods declaration is delivered 
or filed.  
5. 
 
In this context, as regards the goods for which the 
declarations were filed on or after the date of the notification, i.e. 
13.3.2010, in the light of the above discussion on Sections 31 and 131 of 
the Act, we find that such export goods were liable to regulatory duty as 
envisaged by the notification. In juxtaposition, those goods for which the 
declarations were filed prior to the issuance of the notification, such 
export were goods were not liable to regulatory duty under the 
notification. However, the learned counsel for the appellant submitted 
that with respect to the latter category of goods, though the declarations 
were filed prior to the issuance of the notification, they too were liable to 
regulatory duty as they (goods declarations) were subsequently amended 
after the date of the notification. In this regard it is pertinent to note that 
the instant appellant raised this objection before the learned High Court 
but the respondent explained that the amendments to the goods 
declarations were necessitated due to the change of the vessel on which 
the scrap was to be exported. The learned High Court accepted this 
explanation on the ground that as long as the ‘particulars of the goods’, 
required to be correct and complete as per Section 131(1)(a) of the Act, 
remained the same, then any subsequent substitution, amendment of 
revision in respect of any other information to be contained in the 
declaration, is immaterial for the purpose of Section 31 of the Act. We 
find that the view taken by the learned High Court in this regard is 
correct and uphold the same. 
6. 
 
It is the respondent’s case that the contracts for the sale of 
goods to be exported had been entered into on 7.7.2009 before 13.3.2010 
CIVIL APPEAL NO.1079 OF 2011  
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which is the date of the notification. Therefore, on the basis of the 
judgment reported as Al-Samrez Enterprise Vs. The Federation of 
Pakistan (1986 SCMR 1917) no duty can be imposed and collected from 
the respondent. It is the case of the appellants that the respondent is not 
entitled to the benefit of the law laid down in Al-Samrez’s case (supra) 
which has been nullified by the legislature through the insertion of 
Section 31A in the Act according to which, for the purposes of Section 
30, 30A and 31, the rate of duty applicable to any goods shall include: (a) 
any amount of duty imposed under Section 18, 18A and 18C; and (b) the 
amount of duty that may have become payable in consequence of the 
withdrawal of the whole or any part of the exemption or concession from 
duty; whether before or after the conclusion of a contract or 
agreement for the sale of such goods or opening of a letter of credit in 
respect thereof. Thus, according to the learned counsel for the appellant, 
the time of conclusion of the contract becomes irrelevant and thus the 
respondent would be liable to pay regulatory duty upon his export goods. 
For ease of reference, Section 31A is reproduced hereunder:- 
  
31A. Effective rate of duty.- (1) Notwithstanding anything 
contained in any other law for the time being in force or 
any decision of any Court, for the purposes of section 30 
69, 30A and 31, the rate of duty applicable to any goods 
shall include any amount of duty imposed under section 18, 
18A and 18C and the amount of duty that may have become 
payable in consequence of the withdrawal of the whole or 
any part of the exemption or concession from duty whether 
before or after the conclusion of a contract or agreement 
for the sale of such goods or opening of a letter of credit in 
respect thereof.  
 
(2) 
…………………………………………………………… 
 
7. 
 
As mentioned in the earlier portion of this opinion, according 
to Sections 31 and 131 of the Act, the only relevant factor is that of 
CIVIL APPEAL NO.1079 OF 2011  
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delivery of the goods declaration. It is worthy to note that the two said 
sections make no reference whatsoever to the date of entering into or 
conclusion of contract. This Court in Al-Samrez’s case (supra) held that if 
a binding contract was concluded between the parties (importer and the foreign 
exporter) or steps were taken by the importers creating a vested right 
under the existing notification granting exemption, the benefit of an 
exemption could not be taken away and destroyed in modification of the 
earlier one. In order to overcome the said decision, Section 31A supra 
was inserted in the Act, wherein the legislature used the words “before or 
after the conclusion of a contract or agreement for the sale of such goods or opening of a 
letter of credit”. However, we find that this has absolutely no nexus to the 
issue at hand for which “delivery of the goods declaration” is relevant as per 
Sections 31 and 131 of the Act, as mentioned above. Thus, as the 
decisive factor remains to be delivery of the goods declaration, Section 
31A ibid would have no relevance or application to the instant case.   
8. 
 
In the light of the above, this appeal is partly allowed. It is 
dismissed to the extent that where the goods declarations were filed 
before the date of the notification, i.e. 13.3.2010, no regulatory duty was 
payable by the respondent. However, where the goods declarations were 
filed on or after such date, the respondent was liable to pay regulatory 
duty as envisaged by the notification and to this extent, the appeal is 
allowed.  
C.M.A. No.2273/2013 
9. 
 
As we have heard the learned counsel for the respondents, 
therefore this application is disposed of accordingly.  
10. 
 
The foregoing are the reasons for our short order of even date 
which reads as under:- 
 
“For the reasons to be recorded later, this appeal is partly 
allowed, in that it is dismissed to the extent of the Goods 
CIVIL APPEAL NO.1079 OF 2011  
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Declaration (GD) filed by the respondent for export of his 
goods before the imposition of Regulatory Duty on 
13.03.2010, and is allowed to the extent that the GD was 
filed, and even if not filed, on or after 13.03.2010.” 
 
 
 
CHIEF JUSTICE 
 
 
 
JUDGE 
 
 
 
JUDGE 
ISLAMABAD. 
17th May, 2017. 
Approved for reporting 
Mudassar/