ISLAMABAD: The law of advance ruling for classification of goods or determination of origin has been implemented through Finance Act, 2020 from July 01, 2020.
The National Assembly has approved the law of advance ruling that was proposed through Finance Bill, 2020.
According to explanation issued by PWC A F Ferguson Chartered Accountants, the concept of advance ruling presently there in the Customs Act, has been revamped.
Previously, the mechanism is relevant only in respect of classification for assessment of duties on goods intended to be imported/ exported.
Through the Finance Act 2020 the meaning and scope of advance ruling has been enhanced to include the determination of classification, origin, the applicability of particular relief/ exemption on goods and any other matter as Federal Board of Revenue (FBR) may specify.
A new section 212B has been inserted to Customs Act, 1969 which stated:
“212B. Advance Ruling –
(1) An applicant desirous of Advance Ruling may make an application in such form and in such manner as may be prescribed under the rules, stating any of the questions as contained in sub-section (3) hereinafter on which the Advance Ruling is sought.
(2) The question on which advance ruling is sought shall be in respect of.-
(i) Classification of goods under the First Schedule to this Act;
(ii) Determination of origin of the goods under the rules of origin notified for bilateral and multilateral agreements;
(iii) Applicability of notification issued in respect of duties under this Act or any tax or duty chargeable under any other law for the time being in force in the same manner as duty of customs leviable under this Act; or
(iv) Any other matter as the board [FBR] may specify by notification in the official Gazette.
(3) The proceedings for issuance of advance ruling shall be completed within 90 days.
(4) The Ruling issued under sub-section (1) shall be binding on the applicant.
(5) The Ruling issued under sub-section (1) shall be binding on the Customs for a period of one year unless there is a change in law or facts or circumstances on the basis of which the advance ruling was pronounced.
(6) The appeal against the Ruling issued under sub-section (1) shall lie with the Member Customs (Policy) within 30 days of issuance of the Ruling;
Provided that during the appeal period of 30 days, the operation of the Ruling shall remain suspended unless the applicant accepts the Ruling.”