COLLECTORATE OF CUSTOMS
(APPRAISEMENT), KARACHI.
C.No.SI/MISC/11/2000-AC-AUCTIONS Dated: 26-OCT-2000
The Chief (Customs Procedures)
Central Board of Revenue,
Islamabad.
Sub: PROCEDURE FOR DISTRIBUTION OF SALE PROCEEDS UNDER SECTION 201 OF THE CUSTOMS ACT, 1969.
Board’s attention is invited to the provision of section 201 of the Customs Act, 1969, wherein the procedure for sale of goods and application of sale proceeds has been provided.
2. The issue of distribution of sale proceeds requires clarification as no specific instructions are available on this matter. The procedure of distribution of sale proceeds has been examined in this Collectorate, and it has been observed that as per sub-section 2 of section 201 of the Customs Act, 1969 sale proceeds are to be distributed in the following matter;
For issuance amount of sale proceeds is Rs.100 and prevalent rates of Sales Tax and Customs Duty are 15% and 25% respectively;
a. Sale proceeds 100.00
b. Expenses of sale (auctioneer’s commission) = 1% of a 1.00
c. Fright Charges payable, if any (assumed nil) --
d. Balance = a-b-c 99.00
e. Sales Tax = d*rate of ST/(100+rate of ST) 12.91
f. Balance = d-e 86.00
g. Customs Duty = f* rate of CD/(100+rate of ST) 17.22
h. Balance (C&F Value) = f-g 66.67
i. 5% Surcharge of Motmar-e-Alame-Islami 3.44
(as per CGO 4/1979) = 0.05* ____
j. Balance h-i 65.43
k. Charge due to person holding such goods in custody =k
l. Balance, if any, to be paid to owner of goods = j-k
3. For the purpose of calculation of duty and taxes, the rates of duty and taxes may be taken from prevalent on the date of auction of goods.
4. The issue of freight has also been examined. In view of the fact that duty and taxes are to be adjudged in accordance with the actual sale proceeds/delivered weight, the freight should also be adjudged accordingly.
5. It is, therefore, proposed that the Board may like to issue of Custom General Order so that a uniform practice is adopted all over the country. Draft Customs General Order is enclosed for consideration.
DISTRIBUTION OF SALES PROCEEDS
CD RATE = 35
Sales Tax RATE = 15
a. Sale proceeds 3,265,000
b. Expenses of sale (auctioneer’s commission) = 1% of a 32,650
c. Fright Charges payable, if any (assumed nil) --
d. Balance = a-b-c 3,232,350
e. Sales Tax = d*rate of ST/(100+rate of ST) 421,611
f. Balance = d-e 2,810,739
g. Customs Duty = f* rate of CD/(100+rate of ST) 728,710
h. Balance (C&F Value) = f-g 2,082,029
i. 5% Surcharge of Motmar-e-Alame-Islami 104,101
(as per CGO 4/1979) = 0.05* ____
j. Balance h-i 1,977,928
KPT CHARGES (40% OF BALANCE) - 791,171
IMPORTER’S SHARE (60% OF BALANCE) 1,186,757
Signed by
(Manzoor Ahmed)
Collector