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					Finance Bill
   2006



               1
                                            A


                                           BILL


to give effect to the financial proposals of the Federal Government for the year

beginning on the first day of July, 2006, and to amend certain laws


       WHEREAS it is expedient to make provisions to give effect to the financial

proposals of the Federal Government for the year beginning on the first day of July,

2006 and to amend laws for the purposes hereafter appearing;


       It is hereby enacted as follows:-


1.     Short title, extent and commencement.– (1) This Act may be called the

Finance Act, 2006.


       (2)     It extends to the whole of Pakistan.


       (3)     It shall, unless otherwise provided, come into force on the first day of

               July, 2006.


2.     Amendment of Act VIII of 1923.- In the Workmen’s Compensation Act, 1923

(VIII of 1923), In Schedule IV, for the figure “3000” the figure “6000” shall be

substituted.


3.     Amendment of Act XXV of 1934.- The following further amendments shall be

made in the Factories Act, 1934 (XXV of 1934), namely:-




                                                                                     2
      (1)    In section 38, for the words and comma, “ten and a half hours, or

             where the factory is a seasonal one, eleven and a half”, the word

             “twelve” shall be substituted; and


      (2)    in section 45, in sub-section (1), in clause (b), in the first proviso, after

             the word “Provided” the word “further” shall be inserted and before the

             proviso, amended aforesaid, the following new proviso shall be

             inserted, namely :-


                    “Provided that if the employer arranges for the transport

                    facilities, the women may work up to 10 p.m. in two shifts:”.


4.    Amendment of Act XX of 1941.- In the Profession Tax Limitation Act, 1941

(XX of 1941), for section 2 the following shall be substituted and shall be deemed to

have been so substituted on the 1st day of July, 1977, namely:-


      “2. Limitation of tax on professions, etc.- (1) Notwithstanding the

      provisions of any law for the time being in force, any taxes payable in respect

      of any one person by way of tax on professions, trades, callings or

      employments under an Act of a Provincial Assembly, shall cease to be levied

      to the extent to which such taxes exceed one hundred thousand rupees per

      annum.


      (2) Notwithstanding anything contained in any law or in any judgement of any

      court including a High Court and the Supreme Court, the tax on professions,

      trades, callings or employments levied and collected under an Act of a


                                                                                         3
      Provincial Assembly on or after the 1st day of July, 1977, as is not in excess

      of the limit fixed in sub-section (1), shall be deemed to have been validly

      levied and collected and shall not be liable to be refunded and the provisions

      of this Act shall have, and shall be deemed always to have had, effect

      accordingly.”.


5.    Amendment of Ordinance XLVI of 1960.- In the Public Investments

(Financial Safeguards) Ordinance, 1960 (XLVI of 1960), the following further

amendments shall be made, namely:-


(1)   in section 4,-


      (a)    for the words, comma and figure “Companies Act, 1913” the words,

             comma and figure “Companies Ordinance, 1984” shall be substituted;

             and


      (b)    in the margin, for the figures and word “VII of 1913” the figures and

             word “XLVII of 1984” shall be substituted;


(2)   after section 9 the following new section shall be inserted, namely:-


      “9A.   Ordinance not to apply to certain bodies corporate, etc.- (1)

      Notwithstanding anything in this Ordinance a body corporate, company,

      institution, undertaking and establishment, specified in the Schedule to this

      Ordinance, upon privatization pursuant to the Privatization Commission

      Ordinance, 2000 (LII of 2000) shall not be deemed to be a body corporate,

      corporation, institution, undertaking or establishment established with the aid

                                                                                   4
      of public revenues of the Federation or the Federal Government for the

      purposes of this Ordinance.


      (2)    The Federal Government may, by notification in the official Gazette,

      amend the Schedule so as to add any entry thereto, modify or omit any entry

      therein.”; and


      (3)    after section 10 the following Schedule shall be added, namely:-


                                    “THE SCHEDULE

                                     [See section 9A]


      1.     The Pakistan Telecommunication Company Limited.


      2.     The Pakistan Steel Mills Corporation.”


6.    Amendment of Ordinance, 1968 (W.P. Ord. VI of 1968).- In the West Pakistan

Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 (W.P. Ord.

VI of 1968), in the schedule, in paragraph 1,-


      (a)    in clause (a), after sub-clause (5) and entry relating thereto, the

             following new sub-clause and entry relating thereto shall be added,

             namely:-


                       “(6)   contract worker”; and


      (b)    after clause (f), the following new clause shall be, added, namely:-


             “(g)   A “contract worker” is a workman who works on contract basis


                                                                                    5
7.    Amendment of Act, 1968 (XII of 1968).- In the Companies Profits (Workers

Participation) Act, 1968 (XII of 1968), the following further amendments shall be

made namely:-


       (1)   in section 2, for clause (f), the following shall be substituted, namely:

             “(f) “Worker” in relation to a company means an employee of the

             company who falls within the definition of a worker as defined in

             clause (xxx) of section 2 of the Industrial Relations Ordinance, 2002

             (XCI of 2002) and has been in the employment of the company for a

             period of not less than six months.”;


      (2)    in section 5, after sub-section (4), the following new sub-section shall

             be added namely:


             “(5)   Notwithstanding anything contained in this Act or the scheme, if

             any defaulting employer strictly complies with the provisions of section

             3 and distributes the benefits in accordance with paragraph 4 of the

             scheme for the period of default on or before the date fixed by the

             Federal Government, no such penalty shall be imposed and the

             company shall not be liable to pay interest as provided in paragraph 2

             of the scheme.”; and


      (3)    in the Schedule,-




                                                                                         6
(a)   in paragraph 1, in sub-paragraph (iii) for the full stop at the end

      a colon shall be substituted and thereafter the following proviso

      shall be added, namely:-

      “Provided that for the companies established on or after 1st day

      of July 2006,─


      (a)    clause (ii) shall have effect as if for the figure and word

             “20 lacs” the figure and word “5 million” were substituted;

             and


      (b)    clause (iii) shall have effect as if for the figure and word

             “40 lacs” the figure and word “20 million” were

             substituted.”


(b)   in paragraph 4,─


      (i)    in clause (a), under the heading “Categories”, for the

             existing entries, the following shall be substituted,

             namely:


             “1.    Workers drawing average monthly wages not

                    exceeding five thousand rupees.


             2.     Workers      drawing     average    monthly     wages

                    exceeding     five     thousand    rupees     but   not

                    exceeding seven thousand five hundred rupees.



                                                                         7
                              3.     Workers       drawing   average      monthly   wages

                                     exceeding seven thousand five hundred but not

                                     exceeding ten thousand rupees.”; and


(ii)   in clause (d), for the words “rupees six thousand”, the words “the amount of

three times of the minimum wages for unskilled workers as given in the schedule of

Minimum Wages for Unskilled Workers Ordinance, 1969” shall be substituted.


8.     Amendments of Act IV of 1969.- In the Customs Act, 1969 (IV of 1969), the

following further amendments shall be made, namely:-


       (1)   in section 2,-


                    (a)       clauses (c), (d), (ib) and (jj) shall be omitted;


                    (b)       after clause (bb) the following new clause shall be

                              inserted, namely:-


                              “(bba) “audit” means examination of books, records,

                              documents, correspondence, stocks and inventory of

                              goods relating to import, export and other business

                              activities of the persons referred to in section 211, in

                              order to ascertain their liability of duties and taxes and

                              compliance with relevant laws and rules;”;


                    (c)       after clause (kk) the following new clauses shall be

                              inserted, namely:-



                                                                                        8
“(kka)    “documents”      means     a    goods   declaration,

application for claim of refund, duty drawback or

repayment of duty, import or export general manifest,

passenger manifest, bill of lading, airway bill, commercial

invoice and packing list or similar other forms or

documents used for customs clearance or making a

declaration to Customs, whether or not signed or

initialed or otherwise authenticated, and also includes,-

(i)      any   form   of   writing   on   material,   data   or

         information recorded, transmitted, or stored by

         means of a tape recorder, computer or any other

         device, and material subsequently derived from

         information so recorded, transmitted or stored;


(ii)     a label, marking or other form of writing that

         identifies anything of which it forms part or to

         which it is attached by any means;


(iii)    a book, map, plan, graph, or drawing; and


(iv)     a photograph, film, negative, tape, or other device

         in which one or more visual images are embodied

         so as to be capable (with or without the aid of

         some other equipment) of being reproduced; and




                                                             9
                          “(kkb)     “electronic   duty   drawback    filing   and

                          payment       system”     means      Electronic      Duty

                          Drawback       Filing    and    Payment    System     as

                          specified by the rules.”;


            (d)    for clause (la) the following shall be substituted, namely:-


                   “(la)“goods declaration” means a goods declaration filed

                   under sections 79, 104, 131, 139 or 144 and includes a

                   goods declaration electronically filed;”;


            (e)    in clause (w),-


                   (i)    the word “outstanding” shall be omitted; and

                   (ii)   after the word “penalty”, the words “or any other

                          amount” shall be inserted;

            (f)    in clause (x) the word “and” shall be omitted; and


            (g)    in clause (y), for the full stop, at the end, a semi colon

                   and word “;and” shall be substituted and thereafter the

                   following new clause shall be added, namely:-


                   “(z) “surcharge” means an amount or charge required to

                   be paid under sections 21A, 83, 86, 98 and 202A”;.


(2)   in section 4, after the word “Act”, the words “or the rules made

      thereunder” shall be inserted;



                                                                                 10
(3)   in section 18,after sub-section (4), the following new sub-sections

      shall be inserted, namely:-


            “(5)   The Federal Government may, by notification in the

                   official Gazette, levy an additional customs-duty on all or

                   any of the goods imported or exported, as specified in

                   the First Schedule, at a rate not exceeding seventy-five

                   per cent of value of such goods as determined under

                   section 25.


            (6)    The additional customs-duty levied under sub-section (5)

                   shall be-


                   (a)    in addition to any duty imposed under sub-

                          sections (1) and (3) or under any other law for the

                          time being in force; and


                   (b)    leviable on and from the day specified in the

                          notification   issued   under    that   sub-section,

                          notwithstanding the fact that the official Gazette in

                          which such notification appears is published at

                          any time after that day.”;


(4)   section 21A shall be renumbered as sub-section (1) of that section

      and thereafter the following new sub-section shall be added, namely:-




                                                                            11
             “(2) Where deferment of customs-duties is allowed by the

             Board under sub-section (1), a surcharge not exceeding fifteen

             per cent per annum shall also be payable on the deferred

             amount from such date and in the manner as the Board may by

             rules prescribe.”;


(5)   in section 25, after sub-section (15), in Explanation II, the words “bill of

      export or”, occurring thrice, and the figure, letter and word “131A or”

      shall be omitted;


(6)   section 25A shall be renumbered as section 25C and before section

      25C, renumbered as aforesaid, the following shall be inserted,

      namely:-


      “25A. Powers to determine the customs value.- (1) Notwithstanding

      the provisions contained in section 25, the Collector of Customs on his

      own motion, or the Director of Customs Valuation on a reference

      made to him by any person, may determine the customs value of any

      goods or category of goods imported into or exported out of Pakistan

      after following the scheme and sequential order as laid down under

      section 25.


      (2)    The customs value determined under sub-section (1) shall be

      the applicable customs value for assessment of the relevant imported

      or exported goods.



                                                                               12
      (3)   In case of any conflict in the customs value determined under

      sub-section (1), the Director-General of Customs Valuation shall

      determine the applicable customs value.”;


(7)   in section 25C, renumbered as aforesaid,-


            (a)    the words “bill of entry or”, wherever occurring, shall be

                   omitted;


            (b)    in sub-section (1),─


                   (i)    for the words “the Assistant Collector or any other

                          higher officer of customs may” the words and

                          commas “and the Collector of Customs is

                          satisfied that the declared value is not the actual

                          transactional value, he may after approval of the

                          Board” shall be substituted; and


                   (ii)   in clause (i), for the words “value and duties and

                          other taxes leviable on imported goods” the words

                          “such offer and duties and other taxes calculated

                          in accordance with the offer” shall be substituted;

                          and


            (c)    in sub-section (3), for the word and figure “section 25”

                   the words, figures and comma “sections 25 or 25A, as

                   the case may be” shall be substituted;

                                                                          13
(8)   for section 26 the following shall be substituted, namely:-


      “ 26. Obligation       to    produce      documents        and     provide

      information.- (1)    Any person on demand by the appropriate officer

      of customs, by notice in writing, as specified in the notice, shall,-


             (a)    furnish information relating to importation, exportation,

                    purchase, sales, transportation, storage or handling of

                    any goods imported or exported;


             (b)    produce for examination, documents or records that the

                    appropriate officer considers necessary or relevant to

                    the audit, inquiry or investigation under the Act;


             (c)    allow the appropriate officer of Customs to take extracts

                    from or make copies of documents or records; and


             (d)    appear before an officer of Customs and answer any

                    question put to him concerning goods, documents,

                    records and transactions relating to the audit or inquiry

                    or investigation.


      (2)    The appropriate officer of Customs conducting an audit, inquiry

      or investigation as the case may be, under this Act, may require in

      writing any person, department, company or organization to furnish

      such information as is held by that person, department, company or




                                                                              14
      organization which in the opinion of the appropriate officer is required

      for the completion of such audit, inquiry or investigation.


      (3)    The Board may require in writing any person, department,

      company or organization, as the case may be, to provide information

      held by that person, department, company or organization, which in

      the opinion of the Board is required for purposes of formulation of

      policy or administering the laws of Customs, Sales Tax, Federal

      Excise or Income Tax.


      (4)    Every person, department, company or organization shall

      furnish the information requisitioned by the Board or the appropriate

      officer under sub-sections (2) or (3) shall furnish the information so

      requisitioned within the time specified in the notice issued by the

      Board or the appropriate officer.”;


(9)   after section 26, substituted as aforesaid, the following new sections

      shall be inserted, namely:-


      “26A. Conducting the audit.- (1) The appropriate officer of customs

      conducting any audit under this Act shall proceed in the manner as the

      Board may by rules prescribe.


      (2)    Where any audit or inquiry or investigation is to be conducted

      for the purpose of ascertaining the correctness of any declaration or

      document or statement, for determining the liability of any person for


                                                                           15
duty, taxes, fees, surcharge,       fines and penalties, or for ensuring

compliance with all other laws administered by the customs, an

appropriate officer of Customs may,-


(a)    examine, or cause to be examined, upon reasonable notice,

       any record, or any statement or declaration or document

       described in the notice with reasonable specificity, which may

       be relevant to such audit, inquiry or investigation ;


(b)    summon , by giving a notice and reasonable time,-


       (i)     the person who imported, or exported or transported or

               stored or held under customs bond, or filed a goods

               declaration, drawback or refund claim;


       (ii)    any officer, employee or agent of any person described

               in clause (a); and


       (iii)   any person having possession, custody or care of

               records and documents required to be kept under the

               Act, and any other person, as deemed proper, to appear

               before him at a reasonable time and to produce such

               records and documents as specified in the notice and to

               give such testimony under oath as may be relevant.


26B. Access for the purposes of audit.- (1) The appropriate officer

of Customs, after giving a notice in writing specifying the date of visit,

                                                                       16
       shall have access to business or manufacturing premises, registered

       office or any other place where any goods, stocks, documents or

       records relating to the ongoing audit are kept or maintained. Such

       officer may inspect the goods, stocks, documents, records, data,

       correspondence, accounts, statements, utility bills, bank statements,

       information regarding nature and sources of funds or assets with

       which his business is financed, and any other records or documents

       required under any Federal or Provincial laws, maintained in any form

       or mode. Such an officer may take into his custody such documents,

       records or any part thereof, in such form as he may deem fit, against a

       signed receipt.


       (2)    In all cases, except where it would defeat the purpose of the

              audit, a reasonable advance notice regarding a visit shall be

              given to the person concerned.


       (3)    Whosoever causes any obstruction or fails to provide any

              documents, record, statement etc, as required under sub-

              section (1),with an intention to defeat the purpose of the Act by

              way of destroying, altering or concealing any books, documents

              or records required to be maintained under this Act, shall be

              guilty of an offence under this section.”;


(10)   in section 27,-




                                                                            17
       (a)    the words “or Deputy Collector”, wherever occurring, shall be

              omitted; and


       (b)    in sub-section (1),


              (i)    after the word “informs” the words “an officer of Customs

                     not below the rank of” shall be inserted; and


              (ii)   for the words “bill of entry” the words “goods declaration”

                     shall be substituted;


(11)   in section 27A, after the word and comma “owner,” the words and

       comma “to be made before the filing of goods declaration,” shall be

       inserted;


(12)   in section 29,-


       (a)    the words “bill of entry or bill of export or” shall be omitted; and


       (b)    after the words “customs-area”, the words and comma “or

              assigned a Customs Reference Number electronically, as the

              case may be” shall be inserted;


(13)   in section 30, the words “bill of entry or”, wherever occurring, shall be

       omitted;


(14)   in section 31,-




                                                                                18
       (a)      in the marginal note, for the words “export duty”, the words

                “duty on goods exported” shall be substituted;


       (b)      the words “bill of export or”, occurring twice, shall be omitted;

                and


       (c)      in the first proviso, the words “bill or” shall be omitted;


(15)     in section 32, in sub-section (4), for the words “the amount of duty

         payable by him” the word and comma “any amount payable by him

         under this Act,” shall be substituted;


(16)     in section 32A, in sub-section (1), in clauses (b) and (c), for the words

         “bill of entry or bill of export or” the words “goods declaration” shall be

         substituted;


(17)     in section 35,-


         (a)    the words “or Deputy Collector” shall be omitted; and


         (b)    in the Explanation, for the words “bill of export” the words

                “goods declaration” shall be substituted;


(18)     in section 65, in clause (b), for the full stop, at the end, a colon shall

         be substituted and thereafter the following proviso shall be added,

         namely:-




                                                                                 19
       “Provided that where the Customs Computerized System is in

       operation, all loading and discharge may be allowed by the Collector

       of Customs round the clock and on all days.”;


(19)   in section 79, for sub-section (1), the following shall be substituted,

       namely:-


       “(1) The owner of any imported goods shall make entry of such goods

       for home consumption or warehousing or for any other approved

       purposes, within ten days of the arrival of the goods, by,-


       (a)    filing a true declaration of goods, giving therein complete and

              correct   particulars   of   such   goods,   duly   supported   by

              commercial invoice, bill of lading or airway bill, packing list or

              any other document required for clearance of such goods in

              such form and manner as the Board may prescribe ; and


       (b)    assessing and paying his liability of duty, taxes and other

              charges thereon, in case of a registered user of the Customs

              Computerized System:


                     Provided that if, before filing a goods declaration, the

              owner makes a request to an officer of customs not below the

              rank of an Assistant Collector that he is unable, for want of full

              information, to make a correct and complete declaration of the

              goods, then such officer, subject to such conditions as he may


                                                                              20
              deem fit, may permit the owner to examine the goods and

              thereafter make entry of such goods by filing a goods

              declaration after having assessed and paid his liabilities of

              duties, taxes and other charges:


                     Provided further that no goods declaration shall be filed

              prior to ten days of the expected time of arrival of the vessel.”;


(20)   in section 80, after sub-section (5), the following sub-section shall be

       inserted, namely:-


       “(6)   Where a request for clearance by importer is not allowed by an

       officer of customs not below the rank of an Assistant Collector, an

       assessment or decision made under this section, shall, for purposes of

       section 193, be deemed to be an order issued under section 179.”;


(21)   after section 81, the following new section shall be inserted, namely:-


       “ 81A. Power to allow import or export on execution of bonds in

       certain cases.– (1) Where the provisions of this Act or any other law

       requires certain conditions to be met before a person can import or

       export any goods or clear any goods from the customs control and if

       an officer of customs not below the rank of an Assistant Collector is

       satisfied, having regard to the circumstances of the case that such

       condition cannot be met      before such import, export or clearance

       without detriment to that person, he may, notwithstanding anything


                                                                               21
       contained in this Act or such other law, grant leave for such import,

       export or clearance on executing such bond or surety or security and

       subject to such conditions, as he deems appropriate, for meeting the

       requirement of that law within such time after the import, export or

       clearance, as may be specified in the bond.


       (2)    An officer of Customs not below the rank of an Assistant

       Collector shall cancel the bond as discharged in full, and shall on

       demand, deliver it, so cancelled, to the person who has executed or

       who is entitled to receive it, in case the conditions are fulfilled within

       the time specified in the bond and in such a case that person shall not

       be liable to any penalty under this Act or, as the case may be, in such

       other law for the contravention of the provisions thereof.


       (3)    In case the conditions are not fulfilled within the time specified

       in the bond, the officer not below the rank of an Assistant Collector of

       Customs shall, without prejudice to any other action that may be taken

       under this Act or any other law for the time being in force, be entitled

       to enforce the bond.”;


(22)   in section 82,-


       (a)    for the words “one month” the words “twenty days” shall be

              substituted; and


       (b)    for the word “fifteen” the word “ten” shall be substituted;


                                                                              22
(23)   in section 83, in sub-section (2), for the word “thirty” the word “seven”

       shall be substituted;


(24)   section 83A shall be omitted;


(25)   in section 88, in sub-section (5), for the words “bill of entry” the words

       “goods declaration” shall be substituted;


(26)   in section 91, the word “private”, wherever occurring, shall be omitted;


(27)   in section 113, in sub-section (2), the words “bill of export or” and

       words and comma “of the bill of entry or goods declaration, if

       removed” shall be omitted;


(28)   in section 115, in the proviso, the words “after the discovery” shall be

       omitted;


(29)   in section133, for the words “ bill of export” the words “goods

       declaration” shall be substituted;


(30)   in section 134, the words “bill of export or” shall be omitted;


(31)   in section 155C, in sub-section (1), the words “in writing”, shall be

       omitted;


(32)   in section 155H, in clause (b), after the word “evidence” the words “by

       the department” shall be inserted;




                                                                              23
(33)   after section 155P, the following new sections shall be inserted,

       namely:-


       “155Q. Electronic exchange of information and authentication

       through the Customs Computerized System.-                 Any declaration,

       documents      or    record,     accounts,     notice,   order,     payment,

       authentication, authorization or information required, delivered or

       provided by the Customs or any registered user shall be deemed to

       have been required, delivered, provided or done under this Act when

       communicated electronically through the Customs Computerized

       System.


       155R.     Correction    of     clerical   errors.-   Where   the    Customs

       Computerized System is in operation and the Collector of Customs is

       satisfied that incorrect data has been electronically communicated to

       Customs due to any clerical error, he may, for reasons to be recorded

       in writing, direct the correction of the said error. Except as provided

       herein, no person shall alter any data in the Customs Computerized

       System.”;


(34)   in section 156, in sub-section (1), in the Table ,-


       (a)     for serial number 12 and entries relating thereto in columns (1),

               (2) and (3), the following shall be substituted, namely:-


                “12 If a person contravenes such person shall                 26(1)
                    any     provisions   of be liable to a                     and

                                                                                 24
             section 26,                 penalty          not    26(4)
                                         exceeding       one
                                         million rupees and
                                         upon      conviction
                                         before a special
                                         judge,             to
                                         imprisonment for a
                                         term             not
                                         exceeding       one
                                         year or both.

(b)   after serial number 12, and entries relating thereto in columns

      (1), (2) and (3), the following new serial numbers and entries

      relating thereto shall be inserted, namely:-


       “12A If    any     person such person shall                26A
            contravenes       the be liable to a
            provisions of section penalty           not
            26A,                  exceeding        one
                                  million rupees and
                                  upon      conviction
                                  before a Special
                                  Judge, he shall
                                  further be liable to
                                  imprisonment for a
                                  term not exceeding
                                  one year or both.
       12B If     any     person such person shall               26B”;
            contravenes       the be liable to a
            provisions of section penalty           not
            26B,                  exceeding        one
                                  million rupees and
                                  upon      conviction
                                  before a Special
                                  Judge, he shall
                                  further be liable to
                                  imprisonment for a
                                  term not exceeding
                                  one year or both.

(c)   against serial number 44 and 45, in column (2) the words “a bill

      of entry or bill of export or” shall be omitted;


                                                                   25
       (d)    after serial number 47, and entries relating thereto in columns

              (1), (2) and (3), the following new serial number and entries

              relating thereto shall be inserted, namely:-


               “47A If      the      goods          the owner of such          79”;
                    declaration is not filed        goods shall be
                    within the prescribed           liable to a penalty
                    period of ten days,             not exceeding one
                                                    hundred thousand
                                                    rupees.

       (e)    against serial number 66 and 67, in column (2) the words “bill of

              export or” shall be omitted;


       (f)    for serial number 96 and entries relating thereto in columns (1),

              (2) and (3), the following shall be substituted, namely:-


               “96.   If any person commits         such person shall be
                      an offence under              liable to a penalty not
                      section 211,                  exceeding one million
                                                    rupees


(35)   in section 174, the words “bill of export or” shall be omitted;


(36)   in section 179,-


       (a)    for sub-sections (1) and (2), the following shall be substituted,

              namely:-


              “(1)    Subject   to   sub-section    (2),   in   cases     involving

              confiscation of goods or imposition of penalty under this Act or

              the rules made thereunder, the jurisdiction and powers of the



                                                                                26
      Officers of Customs in terms of amount of duties and other

      taxes involved, excluding the conveyance, shall be as follows:-


       (i)         Additional Collector       without limit


       (ii)        Deputy Collector           not    exceeding     five
                                              hundred thousand rupees.

       (iii)       Assistant Collector        not    exceeding       two
                                              hundred      and       fifty
                                              thousand rupees.


      (2)      Notwithstanding the provisions of sub-section (1), the

      Board may, by notification in the official Gazette, fix or vary the

      jurisdiction and powers of any Officer of Customs or a class of

      officers, and may also assign any case to any Collector of

      Customs, irrespective of the territorial jurisdiction.”;


(b)   after sub-section (4), the following new sub-section shall be

      inserted, namely:-


      “(5) Notwithstanding anything contained in this Act, or any other

      law for the time being in force and notwithstanding any decision

      or judgement of any forum, authority or court whether passed

      on or before the commencement of the Finance Act, 2006, the

      time for adjudication in all the cases pending as on first day of

      July, 2006, for whatsoever reasons, shall be deemed always to

      have been extended upto 31st day of December, 2006.”;




                                                                      27
(37)   in section 195, in sub-section (1), the words and bracket “or the

       Collector of Customs (Adjudication)” shall be omitted;


(38)   in section 195C,-


       (a)   in the marginal note, for the word “Alternate” the word

             “Alternative” shall be substituted;


       (b)   in sub-section (1), for the full stop, at the end, a colon shall be

             substituted and thereafter the following proviso shall be added,

             namely :-


             “Provided that only those disputes which are under litigation, in

             any court of law or an adjudicating authority, shall be

             entertained for dispute resolution under the provisions of this

             section”;


       (c)   in sub-section (2), after the word “of”, occurring for the sixth

             time, the words “retired District and Sessions Judge and retired

             Judges of High Court or” shall be inserted;


       (d)   in sub-section (3),-


             (i)    after the word “recommendations” the commas and

                    words “, within forty-five days of its constitution,” shall be

                    inserted; and




                                                                               28
              (ii)   for the full stop, at the end, a colon shall be substituted

                     and thereafter the following proviso shall be added,

                     namely:-


                            “Provided that the period of forty-five days

                     stipulated for making the recommendations may be

                     extended by the Board for another forty-five days on

                     specific request of the committee.”;


(39)   in section 196,-


       (a)    for sub-section (1), the following shall be substituted, namely:-


              “(1)   Within ninety days of the date on which the aggrieved

              person or Collector, as the case may be, was served with order

              of the Appellate Tribunal under sub-section (3) of section 194B,

              the aggrieved person or any officer of Customs not below the

              rank of an Additional Collector, authorized by the Collector,

              may prefer an application, in the prescribed form along with a

              statement of the case, to the High Court, stating any question

              of law arising out of such order.”;


       (b)    in sub-section (6), in the proviso, after the word “by”, occurring

              for the first time, the words “such officer as authorized by the

              Collector or” shall be inserted;




                                                                              29
       (c)    in sub-section (9), after the words “other than”, the words “such

              officer as authorized by the Collector” shall be inserted; and


       (d)    after sub-section (9), the following new sub-section shall be

              inserted, namely :-


              “(10) Notwithstanding anything in this Act where any reference

              or appeal was preferred with the approval of Collector by the

              officer below the rank of Collector, and the reference or appeal

              is pending before appellate forum or the Court, such reference

              or appeal shall be deemed to have been preferred and shall be

              deemed always to have been so preferred by the Collector.”;


(40)   in section 201, in sub-section (1), after the word “owner”, occurring

       twice, the words “or his agent or custodian of the goods” shall be

       inserted;


(41)   after section 202, the following new section shall be inserted, namely:-


       “202A. Levy of surcharge.- Notwithstanding anything contained in

       this Act and without prejudice to any other action that may be taken

       thereunder, if any person fails to pay the arrears within the prescribed

       time, he shall, in addition to the arrears, be liable to pay surcharge at

       the rate of one and a half per cent per month, of the total amount of

       arrears.




                                                                               30
       Explanation.- For the purpose of calculating surcharge, the period of

       default shall be reckoned from the day following the due date on which

       the arrears were required to be paid to the day preceding the date on

       which the same are actually paid.”;


(42)   for section 211, the following shall be substituted, namely:-


       “211. Maintenance of record.            (1) All importers, exporters and

       claimants of duty drawback, refunds or any notified concessions,

       terminal operators, owners of the warehouses, customs agents and

       the licensed customs bonded carriers, carrying out business under

       this Act or any other law, directly or indirectly, relating to international

       trade, shall be required to maintain and keep records and

       correspondence concerning import and export transactions.


       (2)    The records required under sub-section (1) shall be kept for a

       period not less than three years in such form as the Board may by

       notification in the official gazette, specify.




                                                                                31
       (3)    The provision of sub-section (1) shall not be applicable to the

       baggage of the passengers and crew of the conveyance and to the

       recipients of gifts. ”;


(43)   after section 211, the following new section shall be inserted, namely:-


       “211A. Access to the premises and records by the officers of

       Customs.- The appropriate officer may, at any time after giving a

       notice in writing, visit any business or manufacturing premises where

       any raw materials, components, assemblies or sub-assemblies etc.,

       imported at a notified reduced rate of the duties and taxes          are

       manufactured, processed or stored, and inspect the goods, stocks,

       documents or records, data etc., and also take stock of the goods

       imported, manufactured, processed or stored, and the quantity

       thereof.”;


(44)   in sections 160, 163, 176 and 205, the words “or Deputy Collector”

       shall be omitted;




                                                                             32
      (45)   in the Third Schedule, in serial number 16, for the words “Bill of

             export” the words “Goods declaration” shall be substituted; and


      (46)   the amendments set out in the First Schedule shall be made in the
             First Schedule to the Customs Act, 1969 (IV of 1969).

9.    Amendments of Ordinance, 1969 (W.P. Ord. VIII of 1969).- In the West

Pakistan Shops and Establishments Ordinance, 1969 (W.P. Ord. VIII of 1969), the

following further amendments shall be made, namely:-


      (1)    in section 6,-


             (a)    for sub-section (1), the following shall be substituted, namely:-


                    “(1)      Except as otherwise provided in this Ordinance every

                    person employed in any establishment shall, in addition to the

                    leave and holidays as may be admissible to him under sections

                    14, 15 and 16 be allowed as holiday, one day in each week.”;

                    and


             (b)    sub-section (4) shall be omitted.


      (2)    in section 8, in the proviso, for the words “one hundred and fifty” the

             words “six hundred and twenty-four” and for the words “one hundred”

             the words “four hundred and sixty-eight” shall be substituted.


      (3)    in section 9, for the full stop, at the end, a colon shall be substituted

             and thereafter the following proviso shall be added, namely:-



                                                                                    33
            “Provided that no such overtime shall be payable to contract workers

            in receipt of wages being calculated on piece rate basis”.; and


      (4)   for section 10, the following shall be substituted, namely:-


            “10.   Spread-over.- The period of work of an adult and young person

            shall be so arranged that inclusive of the interval for rest or meals

            under section 7, it shall not spread-over more than twelve hours in the

            case of adult and nine hours in the case of young person:


                   Provided that the total period of work so worked out, in case of

            an adult worker, shall not exceed sixty hour and by a young person

            fifty-four hours in a week.”.


10.   Amendment of Ordinance XVII of 1969.-In the Securities and Exchange

Ordinance, 1969 (XVII of 1969), the following further amendments shall be made,

namely:-


      (1)   In section 2, in sub-section (1) ,-


            (a)    in clause (a), for the words “a stock” the word “an” shall be

                   substituted; and


            (b)    in clause (ca), for the words “a stock” the word “an” shall be

                   substituted;


            (c)    after clause (cc), the following new clauses shall be inserted;

                   namely:-


                                                                                34
“(cd) “Commodity Futures Contracts” means an agreement to

       purchase or sell a particular commodity for delivery in

       the future at a price that is determined at the initiation of

       the contract that obligates each party to the contract to

       fulfill the contract at the specified price and that may be

       settled by delivery, cash or offset at an organized

       Exchange duly registered with the Commission and in

       relation     to     Commodity          Futures     the    expression

       “commodity” includes,-


(i)    agricultural, livestock, fishery, forestry, mining or energy

       goods, and any product that is manufactured or

       processed from any such goods; and

(ii)   any other matter as may be notified by the Commission

       in the Official Gazette;


       (ce)   “corporatisation” means the conversion of

              a Stock Exchange from a company limited

              by guarantee to a company limited by

              shares;


       (cf)   “demutualisation” means the segregation

              of the ownership of a Stock Exchange from

              the        right   to   trade     on      such    Stock

              Exchange;”;


                                                                        35
      (d)   after clause (d), the following new clause shall be inserted,

            namely:-


                    “(da) “Exchange” means a Stock Exchange or a

                              Commodity Exchange;”;


      (e)   after clause (dd), the following new clause shall be inserted;

            namely:-


                    “(de) “integration” means the merger of two or

                              more Stock Exchanges in accordance with

                              a scheme approved by the Commission;”;


      (f)   in clause (i) for the words “a Stock” the word “ an” shall be

            substituted;


      (g)   in clause (l),-


            (i)     in sub clause (ii), the word “and” shall be omitted;


            (ii)    in sub-clause (iii), after the semicolon, at the end, the
                    word “and” shall be added; and

            (iii)   after sub-clause (iii) amended as aforesaid, the following

                    new sub-clause shall be added, namely:-


                    “(iv)     Commodity Futures Contract;” ;


(2)   in sections 2, 3, 4, 5, 6, 7, 21, 23, 31, 33 and 34, for the words “a

      Stock” the word “an” shall be substituted;


                                                                                36
(3)   in section 8 in sub-section (1), for the words “unless he is a member

      thereof” the words “otherwise than as may be prescribed” shall be

      substituted;


(4)   in section 22, in sub-section (1), in clause (c), after the word

      “Ordinance” the words “or any rules or regulations made thereunder”

      shall be inserted;


(5)   after section 32 D, the following new section shall be inserted,

      namely:-


      “32E. Corporatisation, demutualisation and integration of the

      stock exchanges.- (1) Notwithstanding anything in any other law for

      the time being in force, the stock exchanges shall stand corporatised

      and demutualised from 31st December, 2006 or from such later date

      as may be specified by the Commission, in such manner and in

      accordance with such conditions as may be prescribed.


      (2)    From the date of effect of corporatisation and demutualisation

      as aforesaid, no stock exchange shall undertake any activity unless it

      is corporatised and demutualised.


      (3)    Any two or more stock exchanges may, upon filing a scheme of

      integration to the Commission for its approval, in such manner and in

      accordance with such conditions as may be prescribed, be merged so

      as to transfer to and vest in the successor stock exchange, all the


                                                                         37
              assets, undertaking, liabilities, rights and obligations of any stock

              exchange which, upon such merger, is proposed to cease to exist.


              (4)    Without prejudice to the provisions of sections 7 and 22, the

              Commission may, by notice in writing, for the purpose of effecting the

              corporatisation and demutualisation of the stock exchanges, issue

              such directions to the stock exchanges, including in respect of their

              memorandum and articles of association, their management and the

              transfer of their shares or business, as the Commission may deem

              expedient.


              (5)    Where a stock exchange fails to comply with any directions

              issued by the Commission under sub-section (4), such stock

              exchange shall be liable to be fined by the Commission by an amount

              not exceeding one hundred thousand rupees.”;


       (6)    in section 33, in sub-section (2), in clause (a), for the word, figure and

              letter “and 32 C” the comma, figures, and word “,32 C and 32 E” shall

              be substituted.


11.    Amendment of Ordinance, 1969 (XX of 1969).-In the Minimum Wages for

Unskilled Workers Ordinance, 1969 (XX of 1969), in the Schedule, in column (2), for

the figure “3000”, occurring thrice, the figure “4000” shall be substituted.




                                                                                     38
12.   Amendment of Ordinance, 1971 (XXXVI of 1971).- In the Workers’ Welfare

Fund Ordinance, 1971 (XXXVI of 1971), the following further amendments shall be

made, namely,─


            (1)    for the words “Income-Tax Officer”, wherever occurring the

                   words, “Taxation Officer” shall be substituted;


            (2)    in section 2,─


                   (a)    in clause (b),─


                         (i)       for the figure, “1969”, the figure “2002” shall be

                                   substituted; and


                         (ii)      in the margin, for figures and words “XXIII of 1969”

                                   the figures and words “XCI of 2002” shall be

                                   substituted;


                   (b)    clause (e) shall be omitted;


                   (c)    in clause (f), for sub-clause (iii), the following shall be

                          substituted, namely.-


                          “(iii)    any concern running a public transport service”;


                   (d)    in clause (ff),


                          (i)       for the figures “1979”, the figures “2001” shall be

                                    substituted; and


                                                                                       39
      (ii)   in the margin, for the figures and word “XXXI of

             1979”, the figures and words “XLIX of 2001” shall

             be substituted;


(e)   after clause (h) a new clause shall be inserted namely:--


      “(ha) “Taxation Officer” means a person appointed to

      be a Taxation Officer under the Ordinance and includes

      a Commissioner as defined in clause (13)A of section 2

      of the Ordinance;


(f)   for clause (i) the following shall be substituted, namely.-

      “total Income” means:


      (i)    where Return of Income is required to be filed

             under this Ordinance, the profit (before taxation or

             provision for taxation) as per accounts or the

             declared income as per the return of income,

             whichever is higher; and


      (ii)   where return of Income is not required to be filed,

             the profit (before taxation or provision for taxation)

             as per accounts or four per cent of the receipt as

             per the statement filed under section 115 of the

             Ordinance, whichever is higher.”;


(g)   in clause (j),

                                                                40
             (i)       for the figures “1969”, the figures “2002)” shall be

                       substituted; and


             (ii)      in the margin, for the figures and word “XXIII of

                       1969”, the figures and words “XCI of 2002” shall

                       be substituted;


(3)   in section 4,


      (a)    in sub-section (1), for the word “one” the word “five” shall

             be substituted, and the words, “or would have been so

             assessable but for the exemption made by section 48

             thereof”, shall be omitted; and


      (b)    for sub-section (3) following shall be substituted namely:


            “(3)      The industrial establishment shall on or before the

            date prescribed for filing of returns of income or a

            statement under the relevant provision of the Ordinance,

            pay the amount due from it under sub-section (1) and

            furnish the proof of payment to the Taxation Officer or the

            Commissioner as the case may be”;

      (c)    in sub-section (8) for the words, “equal to eighty per cent

             per annum of the amount due from it from the date on

             which it was originally payable to the date on which it is

             paid”, the words “as per provisions of the Ordinance,


                                                                        41
             relating to the mode and time of recovery of the income

             tax.” shall be substituted;


      (d)    after sub-section (9) a new sub-section shall be inserted

             namely:-


             “(10) Industrial establishment may file an appeal against

             any    order     passed   by   Taxation   Officer   or     the

             Commissioner as the case may be under this Ordinance

             before the Commissioner (Appeal) appointed under the

             Ordinance”;


(4)   in section 6, for clause (e), following shall be substituted,

      namely.-


      “(e)   investment in government, government guarantees, non-

      government securities and Real Estate”;


(5)   in section 10,


      (a)    for clause (c), following shall be substituted, namely.-


             “(c)   investment in government, government

              guarantees, non-government securities and real

              estate;”; and


      (b)    after clause (c), a new clause shall be added, namely.-




                                                                        42
                           “(ca) to dispose of the moveable and immoveable

                           property of Workers Welfare Fund and Workers Welfare

                           Boards;”;


             (6)    in the said Ordinance, after section 15 the following new

                    section shall be added, namely,─


                    “16.   Exemption      from    taxes.-       Notwithstanding   anything

                    contained in any other law, the Federal Government may, by

                    order in writing, exempt the Institution from any tax, duty, or

                    rate leviable by the Federal Government or by a local authority

                    under the control of the Federal Government.”.


13.   Amendments of Act XIV of 1976,─ In the Employees’ Old-age Benefits Act,

1976 (XIV of 1976), the following further amendments shall be made, namely:-


       (1)   in section 1, in sub-section (4), in clause (i),

             (a)    the word “or” at the end shall be omitted and the semicolon,

                    shall be substituted by colon and thereafter the following

                    proviso shall be added, namely


                    “Provided that for the industry or establishment set up on or

                    after first day of July, 2006 the number of persons shall be

                    enhanced from “ten” to “twenty”;

             (b)    in clause (ia) for the word “ten” the word “twenty” shall be

                    substituted; ─ .

                                                                                       43
      (2)    in the Schedule, in paragraph (2), in proviso, for the words “one

      thousand” the words “one thousand and three hundred’ and for the word and

      figure “January, 2005” the word and figure “July, 2006” shall be substituted.


14.   Amendment of Act XXIX of 1977.- In the Price Control and Prevention of

Profiteering and Hoarding Act, 1977 (XXIX of 1977), for section 11, the following

shall be substituted, namely:-


      “11. Power to try offences summarily.- (1) Offences punishable under this

      Act shall be tried by a Magistrate appointed under section 14A of the Code of

      Criminal Procedure, 1898, in a summary manner as provided in sections 262

      to 265 of the said Code:

             Provided that sub-section (2) of section 262 shall not apply.


             (2)    If a Magistrate has reason to believe that any offence

             punishable under this Act has been committed by any person, he may

             enter the place or premises where the offence has been committed

             and try the offence on the spot.”.


15.   Amendment of Act, (V of 1989).- The following further amendments shall
be made in Finance Act, 1989 (V of 1989), namely,-

             In section 7,

             (1)    in sub-section (1),-

                    (a)      before the word “surrender”, the words and comma
                             “power of attorney,” shall be inserted; and



                                                                                  44
      (b)    the words and comma “or purchase of air ticket,” shall be
             omitted.

      (c)    in the Explanation to sub-section (i), after paragraph (d),
             the following new paragraph shall be added, namely:-

             “(e) “urban area” means area falling within the limits of
             the Islamabad Capital Territory, cantonment board or
             municipal body and includes areas defined as such in
             the Urban Immovable Property Tax Act, 1958 (WP Act V
             of 1958). ”;

(2)   in sub-section (2),-

      (a)    after paragraph (C), the following new paragraph shall
             be inserted, namely:-
              “(CA)
              (a)     Immovable property (other
                      than commercial) situated in
                      urban area, measuring at least
                      one kanal or 500 square yards
                      which ever is less.
                      (i)    Where the value        of    2% of the
                             immovable property     is    recorded
                             recorded.                    value

                      (ii)   Where the value of           Rs.50 per
                             immovable property is not    square yard
                             recorded.                    of the land
                                                          area”;
              (b)     Commercial           immovable
                      property of any size.
                      (i) Where the value of              2% of the
                           immovable property is          recorded
                           recorded.                      value
                      (ii) Where the value of             Rs.50 per
                           immovable property is not      square yard
                           recorded.                      of the land
                                                          area”;
(3)   paragraph (D) shall be omitted; and

(4)   in paragraph (E), for the figure “0.01”, the figure “0.02” shall be
      substituted.
                                                                         45
16.   Amendment in Sales Tax Act, 1990.– The following further amendments

shall be made in the Sales Tax Act, 1990, namely:-


      In the aforesaid Act,–


      (1)    in section 2, –


             (i)    after clause (5), the following new clauses shall be inserted,

                    namely:-


                    “(5A) “common taxpayer identification number” means the

                    registration number or any other number allocated to a

                    registered person;”;


                    “(5AA)“computerized       system”   means   any   comprehensive

                    information technology system to be used by the Board or any

                    other office as may be notified by the Board, for carrying out the

                    purposes of this Act;”;


             (ii)   after clause (9), the following new clause shall be added,

                    namely:-

                    “(9A) “e-intermediary” means a person appointed as e-

                    intermediary under section 52A for filing of electronic returns

                    and such other documents as may be prescribed by the Board




                                                                                   46
        from time to time, on behalf of a person registered under

        section 14;”;


(iii)   in clause (14), for sub-clause (d), the following shall be

        substituted, namely:-


        “(d)   chargeable as duties of excise under section 3 of the

        Federal Excise Act, 2005, on such excisable goods as are

        mentioned in the Second Schedule thereto or such excisable

        services as the Federal Government may from time to time

        notify under section 7 thereof and on which such duties are

        charged, levied and paid as if it were a tax payable under

        section 3 of this Act;”;


(iv)    after clause (29), the following new clause shall be inserted,

        namely:-


        “(29A) “sales tax account” means an account representing the

        double entry recording of sales tax transactions in the books of

        account;”;


(v)     in clause (33), the brackets and words “(excluding financial or

        operating lease)” shall be omitted;


(vi)    in clause (46), in sub-clause (g), for the first and second

        provisos, the following shall be substituted, namely:–




                                                                     47
                     “Provided that, where the Board deems it necessary it

              may, by notification in the official Gazette, fix the value of any

              imported goods or taxable supplies or class of supplies and for

              that purpose fix different values for different classes or

              description of same type of imported goods or supplies:


                     Provided further that where the value at which import or

              supply is made is higher than the value fixed by the Board, the

              value of goods shall, unless otherwise directed by the Board,

              be the value at which the import or supply is made;”; and


      (vii)   in clause (47), for the words, figures and brackets “whose

              income is not liable to tax under the Income Tax Ordinance,

              2001 (XLIX of 2001) but has deducted income tax at source

              under section 153 of the said Ordinance” the words, figures

              and brackets “who deducts income tax at source under the

              Income Tax Ordinance, 2001 (XLIX of 2001)” shall be

              substituted;


(2)   in section 8, in sub-section (1), after clause (c) the following new

      clause shall be inserted, namely:-


              “(ca) the goods in respect of which sales tax has not been

              deposited in the Government treasury by the respective

              supplier;”;



                                                                             48
(3)   after section 8, amended as aforesaid, the following new section shall

      be inserted, namely:-


      “8A.   Joint and several liability of registered persons in supply

      chain where tax unpaid.– Where a registered person receiving a

      taxable supply from another registered person is in the knowledge or

      has reasonable grounds to suspect that some or all of the tax payable

      in respect of that supply or any previous or subsequent supply of the

      goods supplied would go unpaid, such person as well as the person

      making the taxable supply shall be jointly and severally liable for

      payment of such unpaid amount of tax.”;


(4)   in section 10, in sub-section (2), the words “in connection with a zero-

      rated supply” shall be omitted;


(5)   for section 11A, the following shall be substituted, namely:-


      “11A. Short     paid    amounts     recoverable     without     notice.–

      Notwithstanding any of the provisions of this Act, where a registered

      person pays the amount of tax less than the tax due as indicated in his

      return, the short paid amount of tax along with default surcharge shall

      be recovered from such person by stopping removal of any goods

      from his business premises and through attachment of his business

      bank accounts, without giving him a show cause notice and without

      prejudice to any other action prescribed under section 48 of this Act or

      the rules made thereunder:

                                                                           49
             Provided that no penalty under section 33 of this Act shall be

      imposed unless a show cause notice is given to such person.”;


(6)   in section 13, sub-section (4) shall be omitted;


(7)   in section 22, in sub-section (1), after clause (d) the following new

      clause shall be inserted, namely:-


             “(da) double entry sales tax accounts;”;


(8)   in section 26,–


      (a)    in the marginal note, the word “Monthly” shall be omitted;


      (b)    in sub-section (1),–


             (i)    after the word “bank”, the words “or any other office”

                    shall be inserted; and


             (ii)   for the full stop, at the end, a colon shall be substituted

                    and thereafter the following new provisos shall be

                    added, namely:-


                           “Provided that the Board may, by notification in

                    the official Gazette, require any person or class of

                    persons to submit return on quarterly basis:


                           Provided    further   that    the   Board   may,   by

                    notification in the official Gazette, require any person or


                                                                              50
                    class of persons to submit such return as may be

                    prescribed annually in addition to the monthly return or

                    quarterly return:


                           Provided also that the return filed electronically on

                    the web or any magnetic media or any other computer

                    readable media as may be specified by the Board shall

                    also be deemed to be a return for the purpose of sub-

                    section (1) and the Board may, by notification in the

                    official Gazette, make rules for determining eligibility of

                    the data of such returns and e-intermediaries who will

                    digitize the data of such returns and transmit the same

                    electronically under their digital signatures.”; and


      (c)    for sub-section (3), the following shall be substituted, namely:-


             “(3)   A registered person may, subject to approval of the

             Collector of Sales Tax having jurisdiction, file a revised return

             within ninety days of the filing of return under sub-section (1) or,

             as the case may be, sub-section (2), to correct any omission or

             wrong declaration made therein.”;


(9)   in section 32A, in sub-section (1), for the full stop, at the end, a colon

      shall be substituted and thereafter the following new proviso shall be

      inserted, namely:-



                                                                              51
               “Provided that the Board may, by notification in the official

       Gazette, appoint a firm of Chartered Accountants as defined under

       Chartered Accountants Ordinance, 1961 (X of 1961), to conduct audit

       of refund claims.”;


(10)   in section 33, in the Table, in column (1), after serial number 19 and

       the entries relating thereto in columns (2) and (3), the following new

       serial numbers and the entries relating thereto, shall be added,

       namely:-


        “20. Any person who fails to submit       Such person           26(5)

              summary of sale and purchase        shall pay a

              invoices     required   under   a   penalty of

              notification issued under this      twenty-five

              Act.                                thousand

                                                  rupees.


        21.    Where any person repeats           Such person         General

               an    offence    for   which   a   shall pay twice

               penalty is provided under          the amount of

               this Act.                          penalty provided

                                                  under the Act for

                                                  the said offence.


        22.     Any person who,-                  Such person          50A.”;



                                                                            52
                                     shall pay a
(a) knowingly and without
                                     penalty of
lawful      authority        gains
                                     twenty-five
access to or attempts to
                                     thousand rupees
gain     access         to     the
                                     or one hundred
computerized system; or
                                     per cent of the

(b) unauthorizedly uses or           amount of tax

discloses or publishes or            involved,

otherwise        disseminates        whichever is

information obtained from            higher. He shall,

the computerized system; or          further be liable,

                                     upon conviction
(c) falsifies any record or
                                     by the Special
information stored in the
                                     Judge, to
computerized system; or
                                     imprisonment for
(d) knowingly or dishonestly
                                     a term which
damages or impairs the
                                     may extend to
computerized system; or
                                     one year, or with

(e) knowingly or dishonestly         fine which may

damages or impairs any               extend to an

duplicate tape or disc or            amount equal to

other medium on which any            the loss of tax

information obtained from            involved, or with



                                                          53
              the computerized system is            both.

              kept or stored; or


             (f)   unauthorizedly            uses

             unique user identifier of any

             other      registered     user    to

             authenticate a transmission

             of      information       to     the

             computerized system; or

             (g) fails to comply with or

             contravenes         any   of     the

             conditions         prescribed    for

             security      of    unique      user

             identifier.


(11)   after section 38A, the following new section shall be added, namely:-

       “38B. Obligation          to    produce      documents   and   provide

       information.—(1) Notwithstanding anything contained in this Act or

       any other law for the time being in force, any person required to

       maintain the record under the Act, on demand by an officer, not below

       the rank of a Deputy Collector of Sales Tax, by notice in writing, as

       and when specified in the notice, shall─

             (a)      produce for examination, such documents or records

                      which the officer of Sales Tax considers necessary or


                                                                           54
              relevant to the audit, inquiry or investigation under the

              Act;

       (b)    allow the officer of Sales Tax to take extracts from or

              make copies of such documents or records; and

       (c)    appear before the officer of Sales Tax and answer any

              question put to him concerning the documents and

              records relating to the audit or inquiry or investigation

              referred to in clause (a) above.


(2)    An officer of Sales Tax conducting an audit, inquiry or, as the

case may be, an investigation under the Act, may require in writing

any person, department, company or organization to furnish such

information as is held by that person, department, company or

organization, which, in the opinion of the officer of Sales Tax, is

relevant to such audit, inquiry or investigation.


(3)    The Board may require, in writing, any person, department,

company or organization, as the case may be, to provide any

information or data held by that person, department, company or

organization, which, in the opinion of the Board, is required for

purposes of formulation of policy or administering the Customs, Sales

Tax, Federal Excise or Income Tax.


(4)    Every person, department, company or organization shall

furnish the information requisitioned by the Board or the officer of

                                                                    55
       Sales Tax under sub-section (2) or (3), within the time specified in the

       notice issued by the Board or, as the case may be, the officer of Sales

       Tax.”;

(12)   section 40A shall be omitted;


(13)   in section 45, the existing section shall be numbered as sub-section

       (1) of that section and thereafter the following new sub-section shall

       be added, namely:-


       “(2)     Notwithstanding anything contained in sub-section (4) of

       section 11 and sub-section (3) of section 36 or any other provision of

       the Act or any other law for the time being in force and

       notwithstanding any decision or judgment of any forum, authority or

       court, the time for adjudication in all the cases pending as on 30th

       June, 2006, shall be deemed always to have been extended up to 31st

       December, 2006, from the date on which the time-limit prescribed

       under sub-section (4) of section 11 and sub-section (3) of section 36,

       expires.”;


(14)   in section 45B, sub-section (4) shall be omitted;


(15)   in section 46, in sub-section (1), for the words “the Sales Tax

       Department”, the words “an officer of Sales Tax not below the rank of

       an Additional Collector” shall be substituted;


(16)   in section 47,–


                                                                            56
       (a)   in sub-section (1), for the words “Deputy Collector”, the words

             and commas “an Additional Collector, authorized by the

             Collector,” shall be inserted;


       (b)   in sub-section (7), in the proviso, after the word “application”,

             the words “by an Additional Collector authorized” shall be

             inserted;


       (c)   in sub-section (10), after the word “the” the words “Additional

             Collector authorized by the” shall be inserted; and


       (d)   after sub-section (10), the following new sub-section shall be

             added, namely:-


             “(11) Notwithstanding anything contained in any provision of

             this Act, where any reference or appeal was filed with the

             approval of Collector by the officer of lower rank than the

             Collector, and the reference or appeal is pending before an

             appellate forum or the Court, such reference or appeal shall

             always be deemed to have been so filed by the Collector.”;


(17)   in section 47A,–


       (a)   in the marginal note, for the word “Alternate”, the word

             “Alternative” shall be substituted;




                                                                           57
       (b)    in sub-section (1), after the word “tax” appearing for the first

              time the words and comma “pending before an Appellate

              authority or the High Court,” shall be inserted;


       (c)    for sub-section (2) the following shall be substituted, namely:-


              “(2)   The Board may, after examination of the application of a

              registered person, appoint a committee consisting of an officer

              of sales tax not below the rank of an Additional Collector and

              two persons from the notified panel consisting of retired Judges

              not below District and Sessions Judge, chartered or cost

              accountants, advocates, representatives of trade bodies or

              associations, or any other reputable taxpayers, for the

              resolution of dispute.”; and


       (d)    for sub-section (5), the following shall be substituted, namely:-

              “(5) The registered person may make payment of sales tax and

              other duty and taxes as determined by the Board in its order

              under sub-section (4), and such order of the Board shall be

              submitted before the forum, tribunal or the Court where the

              matter is sub-judice, for consideration and orders as deemed

              appropriate.”;


(18)   after section 50, the following new section shall be inserted, namely:-

       “50A. Computerized system.—(1) The Board may prescribe the use

       of computerized system for carrying out the purposes of this Act,
                                                                                 58
       including the receipt of applications for registration, returns and such

       other declarations or information required to be provided under this

       Act and the rules made thereunder, from such date and for such

       registered persons or class of persons as the Board may, by

       notification in the official Gazette, specify.


       (2)    The Board may make rules for regulating the conduct and

       transaction of business in relation to the submission of returns or other

       information to the Board by the persons required to transmit or receive

       any information through the computerized system, including their

       authorization, suspension and cancellation of authorization and for

       security of the information transmitted or received through the

       computerized system.”;


(19)   after section 52, the following new section shall be added, namely:-


       “52A. e-intermediaries to be appointed.— (1) Subject to such

       conditions, limitations and restrictions, the Board may, by a notification

       in the official Gazette, appoint a person to electronically file return

       under Chapter V and such other documents electronically, as may be

       prescribed from time to time, on behalf of a person registered under

       section 14.


       (2)    A person registered under section 14 may authorize an e-

       intermediary to electronically file return or any other documents, as

       specified in sub-section (1).

                                                                              59
(3)   The return or such other documents filed by an e-intermediary

on behalf of a registered person shall be deemed to have been filed

by that registered person.


(4)   Where this Act requires anything to be done by the registered

person and if such thing is done by an e-intermediary authorized by

the registered person under sub-section (2), unless the contrary is

proved, shall be deemed to have been done with the knowledge and

consent of such registered person so that in any proceedings under

this Act, the registered person shall be liable as if the thing has been

done by him.


(5)   Where an e-intermediary, authorized by a registered person

under sub-section (2) to act on his behalf, knowingly or willfully

submits a false or incorrect information or document or declaration

with an intent to avoid payment of tax due or any part thereof or

claiming a tax credit or a refund that is not due to the registered

person, such e-intermediary shall be jointly and severally responsible

for recovery of the amount of tax short paid or the amount refunded in

excess as a result of such incorrect or false information or document

or declaration, without prejudice to any other action that may be taken

against him under the relevant provisions of the law.


(6)   The Board may, by notification in the official Gazette, prescribe

rules for the conduct and transaction of business of e- intermediaries,


                                                                     60
       including     their     appointment,   suspension     and   cancellation   of

       appointment, subject to such conditions as specified therein.”;


(20)   in the Third Schedule,–


       (a)   for serial number 17 in column (1), for the entries in columns (2)

             and (3), the following shall be substituted, namely:-


              “17.           Toilet paper and tissue paper     4818.1000 and
                                                               4818.2000”; and

       (b)   after serial number 17 in column (1) and the entries relating

             thereto in columns (2) and (3), substituted as aforesaid, the

             following new serial numbers and the entries relating thereto

             shall be added, namely:-


                   “18.      Spices sold in retail packing 09.04, 09.06, 09.08
                             bearing brand names and trade and 09.10
                             marks

                   19.       Electric bulbs including energy 85.39
                             saving lamps and fluorescent
                             tube lights

                   20.       Snacks including potato chips 19.05 and 20.05
                             sold in retail packing

                   21.       Shoe polish and shoe cream        3405.1010”; and


(21)   in the Sixth Schedule, in column(1),–


       (a)   serial numbers 4, 5, 6, 7, 8, 9, 10 and 40 and the entries

             relating thereto in columns (2) and (3) shall be omitted; and




                                                                                  61
            (b)    for serial number 43, and the entries relating thereto in columns

                   (2) and (3), the following shall be substituted, namely:-


                    “43.        Aircrafts                  8802.2000, 8802.3000
                                                           and 8802.4000”.


17.   Amendment of the Income Tax Ordinance, XLIX of 2001.– The following

further amendments shall be made in the Income Tax Ordinance, 2001 (XLIX of

2001), namely:–


      (1)   in section 2,-


            (a)    after clause (3C), the following new clauses shall be inserted,

                   namely:-


                   “(3D) “Approved Employment Pension or Annuity Scheme”

                   means any employment related retirement scheme approved

                   under this Ordinance, which makes periodical payment to a

                   beneficiary i.e. pension or annuity such as approved

                   superannuation fund, public sector pension scheme and

                   Employees Old-Age Benefit Scheme;


                   (3E)      “Approved Occupational Savings Scheme” means any

                   approved gratuity fund or recognized provident fund;”;


            (b)    in clause (13B), the comma and words “, but not exceeding five

                   hundred thousand rupees in a tax year” shall be omitted;


            (c)    in clause (19A),-

                                                                                  62
      (i)    the words “but does not include an individual who is

             entitled to benefit under any other approved employment

             pension or annuity scheme”, shall be omitted;


      (ii)   for the semicolon, at the end, a colon shall be

             substituted and thereafter the following proviso shall be

             added, namely:-


                    “Provided that the total tax credit available for the

             contribution made to approved employment pension or

             annuity scheme and approved pension fund under

             Voluntary Pension System Rules, 2005, should not

             exceed the limit prescribed or specified in section 63.”;


(d)   in clause (41),-


      (i)    after the letter “a”, occurring for the second time, the

             word “fixed” shall be inserted;


      (ii)   in sub-clause (c), after the word “project”, occurring for

             the second time, the words “but only where such site,

             project and its connected supervisory activities continue

             for a period or periods aggregating more than ninety

             days within any twelve-months period” shall be added;

             and




                                                                          63
      (e)    after clause (47), the following new clauses shall be inserted,

             namely:-


             “(47A) “Real Estate Investment Trust (REIT)” means a scheme

             which consists of a closed-end collective investment scheme

             constituted as a unit trust fund and managed by a REIT

             management company for the purposes of investment in real

             estate, approved and authorized by the Security and Exchange

             Commission of Pakistan under the Real Estate Investment

             Trust Rules, 2006”;


             (47B) “Real Estate Investment Trust Management Company”

             means a company licensed by the Security and Exchange

             Commission of Pakistan under the Real Estate Investment

             Trust Rules, 2006.”;


(2)   in section 15, after sub-section (5), the following new sub-section shall

      be added, namely:-


      “(6)   Income under this section shall be liable to tax at the rate

      specified in Division VI of Part I of the First Schedule.”;


(3)   section 17, shall be omitted;


(4)   in section 21,-


      (i)    clause (k), shall be omitted;



                                                                            64
(ii)   for clause (l), the following shall be substituted, namely,-


       “(l)   any expenditure for a transaction, paid or payable under

       a single account head which, in aggregate, exceeds fifty

       thousand rupees, made other than by a crossed cheque drawn

       on a bank or by crossed bank draft or crossed pay order or any

       other crossed banking instrument showing transfer of amount

       from the business bank account of the taxpayer:


              Provided that online transfer of payment from the

       business account of the payer to the business account of payee

       as well as payments through credit card shall be treated as

       transactions through the banking channel, subject to the

       condition that such transactions are verifiable from the bank

       statements of the respective payer and the payee:


              Provided further that this clause shall not apply in the case

       of–


              (a)    expenditures not exceeding ten thousand rupees;


              (b)    expenditures on account of –


                     (i)     utility bills;

                     (ii)    freight charges;

                     (iii)   travel fare;

                     (iv)    postage; and

                                                                       65
                            (v)    payment of taxes, duties, fee, fines or any

                                   other statutory obligation;”;


(5)   in section 39, in sub-section (3), the word “card” shall be omitted;


(6)   in section 49, after sub-section (2), the following new sub-section shall

      be added, namely:-


      “(3)   Subject to sub-section (2), any payment received by the

             Federal Government, a Provincial Government or a local

             authority shall not be liable to any collection or deduction of

             advance tax.”.


(7)   in section 62, in sub-section (2), in paragraph C, in clause (c), for the

      words “one hundred and fifty”, the words “two hundred” shall be

      substituted;


(8)   in section 63, in sub-section (2) , in paragraph C, in clause (ii),-


      (a)    after the word “the”, occurring for the first time, the word

             “eligible” shall be inserted;


      (b)    for the words “a person” the words “an eligible person” shall be

             substituted;


      (c)    for the words, figure and commas “of the notification of the

             Voluntary Pension System Rules, 2005,” the words, figures and

             comma “starting from July 1, 2006” shall be substituted; and


                                                                             66
       (d)    after sub-section (2) , the following sub-section shall be added,

              namely:-


              “(3)   The transfer by the members of approved employment

              pension or annuity scheme or approved occupational saving

              scheme of their existing balance to their individual pension

              accounts maintained with one or more pension fund managers

              shall not qualify for tax credit under this section.”;


(9)    in section 82, in clause (a), for the word “eighty-two” the word “eighty-

       three” shall be substituted;


(10)   in section 113B, the words and commas “of textile fabrics and articles

       of apparel including ready-made garments or fashion wear, articles of

       leather including footwear, carpets, surgical goods and sports goods”,

       shall be omitted;


(11)   in section 114, in sub-section (1),-


       (a)    after clause (ab), the following new clauses shall be inserted,

              namely:-


              “(ac) any non-profit organization as defined in clause (36) of

                     section 2; and


              (ad)   any welfare institution approved under clause (58) of

                     Part I of the Second Schedule;”; and



                                                                             67
       (b)    in clause (b), for the brackets, letters and word “(a) or (ab)”, the

              brackets, letters, commas and word “(a), (ab), (ac) or (ad)” shall

              be substituted;


(12)   in section 115, in sub-section (4),-


       (a)    after the comma, occurring for the third time, “,” the figure and

              comma “15,” shall be inserted;


       (b)    after the comma, occurring for the sixth time, “,” the words,

              brackets, letters, commas and figures “clauses (a), (b) and (d)

              of sub-section (1) of section 151, section 152,” shall be

              inserted;


(13)   after section 122A, the following new section shall be inserted,

       namely:-


       “122B. Revision by the Regional Commissioner.- (1) The Regional

       Commissioner may, either of his own motion or on an application

       made by the taxpayer for revision, call for the record of any

       proceedings relating to issuance of an exemption or lower rate

       certificate with regard to collection or deduction of tax at source under

       this Ordinance, in which an order has been passed by any authority

       subordinate to him.


       (2)    Where, after making such inquiry as is necessary, Regional

       Commissioner considers that the order requires revision, the Regional

                                                                               68
       Commissioner may, after providing reasonable opportunity of being

       heard to the taxpayer, make such order as he may deem fit in the

       circumstances of the case.”;


(14)   in section 134A,-


       (a)    in the heading, for the word “Alternate” the word “Alternative”

              shall be substituted; and


       (b)    for sub-section (1), the following shall be substituted, namely:-


              “(1)   Notwithstanding any other provision of this Ordinance, or

                     the rules made thereunder an aggrieved person, in

                     connection with any matter pending before an Appellate

                     Authority, may apply to Board for the appointment of a

                     committee for the resolution of any hardship or dispute

                     mentioned in detail in the application.”;


       (c)    in sub-section (5),-


              (i)    in the first proviso, the commas and words “, in case the

                     matter is already sub-judice before any authority or

                     tribunal or the court,” shall be omitted; and


              (ii)   after the word “court” the words “where the matter is

                     subjudice” shall be inserted;


(15)   in section 147,-


                                                                              69
       (a)    in sub-section (1), after clause (c), the following new clause

                     shall be inserted, namely:-


              “(ca) income chargeable to tax under section 233 and clauses

                     (a) and (b) of sub-section (1) of section 233A;”;


       (b)    sub-section (4A), shall be re-numbered as sub-section (4B) and

              before sub-section (4B), re-numbered as aforesaid, the

              following new sub-section shall be inserted, namely:-


              “(4A) Any taxpayer who is required to make payment of

              advance tax in accordance with sub-section (4), shall estimate

              the tax payable by him for the relevant tax year, at any time

              before the last installment is due. In case the tax payable is

              likely to be more than the amount he is required to pay under

              sub-section (4), the taxpayer shall furnish to the Commissioner

              an estimate of the amount of the tax payable by him and

              thereafter pay such amount after making adjustment for the

              amount (if any) already paid in terms of sub-section (4).”;


(16)   in section 148:-


       (a)     in sub-section (3), for the word “one hundred”, the word

               “seventy five” shall be substituted;


       (b)    for sub-section (7), the following shall be substituted, namely:-




                                                                              70
             “(7)   The tax collected under this section shall be a final tax

             on the income of the importer arising from the imports subject

             to sub-section (1) and this sub-section shall not apply in the

             case of import of–


                    (a)    raw material, plant, machinery, equipment and

                           parts by an industrial undertaking for its own use;


                    (b)    fertilizer by manufacturer of fertilizer; and


                    (c)    cars in CBU condition by manufacturer of cars.”;


(17)   in section 151, after sub-section (2), the following new sub-section

       shall be added, namely,-


             “(3)   Tax deducted under this section shall be a final tax on

             the profit on debt arising from transactions referred to in

             clauses (a), (b) and (d) of sub-section (1).”;


(18)   in section 152, after sub-section (1), the following new sub-sections

       shall be inserted, namely:-


             “(1A) Every person making a payment in full or part (including

             a payment by way of advance) to a non-resident person on the

             execution of –


                    (a)    a contract or sub-contract under a construction,

                           assembly or installation project in Pakistan,


                                                                            71
                            including a contract for the supply of supervisory

                            activities in relation to such project; or


                     (b)    any other contract for construction or services

                            rendered relating thereto; or


                     (c)    a contract for advertisement services rendered by

                            T.V. Satellite Channels,


                     shall deduct tax from the gross amount payable under

                     the contract at the rate specified in Division II of Part III

                     of the First Schedule.


              (1B)   The tax deducted under sub-section (1A) shall be a final

                     tax on the income of a non-resident person arising from

                     a contract.”;


(19)   in section 153,-


       (a)    after sub-section (1), the following new sub-section shall be

              inserted, namely:-


              “(1A) Every exporter or an export house making a payment in

              full or part including a payment by way of advance to a resident

              person or permanent establishment in Pakistan of a non-

              resident person for the rendering of or providing of services of

              stitching, dying, printing, embroidery, washing, sizing and



                                                                               72
      weaving, shall at the time of making the payment, deduct tax

      from the gross amount payable at the rate specified in Division

      IV of Part III of the First Schedule.”;

(b)   sub-section (3) shall be omitted;


(c)   in sub-section (6)-


      (i)    the words and brackets “clause (a) or (c) of” shall be

             omitted;


      (ii)   after the brackets and figure “(1)”, the word, figure, letter

             and brackets “and (1A)” shall be inserted;


(d)   sub-section (7), shall be omitted;


(e)   after sub-section (8), the following new sub-section shall be

      inserted, namely:-


      “(8A) Every person from whom tax is being collected under this

      section shall disclose his National Tax Number to the

      withholding agent.      In case of there being no National Tax

      Number (NTN), Computerized National Identity Card Number

      (CNIC) shall be provided. Where a person fails to disclose his

      NTN or CNIC number, as the case may be, at the time of

      collection or deduction of tax, the rate of withholding tax shall

      be two per cent over and above the rates specified in Division

      III of Part III of the First Schedule;”;

                                                                       73
       (f)    in sub-section (9),-


              (a)    in clause (d), the word “or” shall be omitted;


              (b)    in clause (e), after the semicolon, the word “or” shall be

                     inserted; and


              (c)    after clause (e), amended as aforesaid, the following

                     new clause shall be inserted, namely:-


                               “(f)   an exporter or an export house for the

                               purpose of sub-section (1A).”;


       (g)    clauses (i) and (iv) of SRO. 600(I)/91 dated 2nd July, 1991 shall

              be omitted.


(20)   in section 154, in sub-section (4), for the word, figures, brackets and

       commas “sub-section (1), (3), (3A) or (3B)” the words “this section”

       shall be substituted;


(21)   in section 155,-


       (a)    in sub-section (1), for the words, brackets, figure and comma

              “subject to sub-section (2), every” the word “Every” shall be

              substituted;


       (b)     for sub-section (2) the following sub-section shall be

               substituted, namely:-



                                                                               74
              “(2)    The tax deducted under sub-section (1) shall be a final

                      tax on the income from property.”;


       (c)    for sub-section (3), the following shall be substituted, namely:-


              “(3) In this section, “prescribed person” means –


              (i)     the Federal Government;


              (ii)    a Provincial Government;


              (iii)   local authority;


              (iv)    a company;


              (v)     a non-profit organization;


              (vi)    a diplomatic mission of a foreign state; or


              (vii)   any other person notified by the Central Board of

                      Revenue for the purpose of this section.”;


(22)   in section 156B, in sub-section (1),-


       (a)    in clause (a), for the semicolon, at the end, a colon shall be

              substituted and thereafter the following provisos shall be

              added, namely:-


                      “Provided that the tax shall not be deducted in case of

              the eligible person suffering from any disability as mentioned in


                                                                              75
              sub-rule (2) of rule 17 of the Voluntary Pension System Rules,

              2005 which renders him unable to continue with any

              employment at the age which he may so elect to be treated as

              the retirement age or the age as on the date of such disability if

              not so elected by him:

                     Provided further that the tax shall not be deducted on the

              share of the nominated survivor of the deceased eligible person

              and would be treated as if the eligible person had reached the

              age of retirement.”;


       (b)    after clause (b), for the proviso the following shall be

              substituted, namely:-


                     “Provided that the tax shall not be deducted in case, the

              balance in the eligible persons’ individual pension account is

              invested in an approved income payment plan of a pension

              fund manager or paid to a life insurance company for the

              purchase of an approved annuity plan or is transferred to an

              other individual pension account of the eligible person or the

              survivors’ pension account in case of death of the eligible

              person maintained with any other pension fund manager as

              specified in the Voluntary Pension System Rules, 2005.”;

(23)   in section 165,-




                                                                             76
       (a)    in sub-section (2), after the letter “a”, occurring for the second

              time, the word and comma “monthly,” shall be inserted;


       (b)    after sub-section (2), the following new sub-sections shall be

              added, namely:-


              “(3) Central Board of Revenue may prescribe a statement

              requiring any person to furnish information periodically in

              respect of any transactions in the prescribed form and verified

              in the prescribed manner.


              (4)    A person required to furnish a statement under sub-

              section (2), may apply in writing, to the Commissioner for an

              extension of time to furnish the statement after the due date

              and the Commissioner if satisfied that a reasonable cause

              exists for non-furnishing of the statement by the due date may,

              by an order in writing, grant the applicant an extension of time

              to furnish the statement.

              (5)    The Board may make rules relating to electronic

              furnishing of statements under this section including,-

                     (a)    mandatory electronic filing of statements; and

                     (b)    determination of eligibility of the data of such

                            statements and e-intermediaries, etc.”;


(24)   in section 168, in sub-section (3),-


                                                                             77
       (a)    after the comma, occurring after the figure “148” the words,

              brackets, commas and figures “clauses (a), (b) and (d) of sub-

              section (1) of section 151, sub-section (1B) of section 152,”

              shall be inserted;


       (b)    for the words, brackets and figures “sub-sections (6) or (7)”, the

              word, brackets and figure “sub-section (6)” shall be substituted;


       (c)    after the figure and comma “154,” the word, figure and comma

              “section 155,” shall be inserted; and


       (d)    after the comma, occurring after the figure “156”, the words,

              brackets, figures, commas and letters “sub-section (2) of

              section 156A, section 233, clauses (a) and (b) of sub-section

              (1) of section 233A” shall be inserted;


(25)   in section 169, in sub-section (1), in clause (b),-


       (a)    after the word “under”, the words, brackets, letters, figures, and

              commas “clauses (a), (b) and (d) of sub-section (1) of section

              151, sub-section (1B) of section 152,” shall be inserted; and


       (b)    for the words, brackets and figures “sub-sections (6) or (7)”, the

              word, brackets and figure “sub-section (6)” shall be substituted;

              and




                                                                              78
       (c)    after the figure and comma “154,” the word, figure and comma

              “section 155,” shall be inserted;


(26)   in section 205, in sub-section (1B),-


       (a)    after the word “sub-section” the brackets, figure, letter and word

              “(4A) or” shall be inserted; and


       (b)    for the word “eighty”, occurring twice, the word “ninety” shall be

              substituted;


(27)   in section 206, for sub-section (2), the following shall be substituted,

       namely:-


              “(2)   A circular issued by the Central Board of Revenue shall

              be binding on all Income Tax Authorities and other persons

              employed in the execution of the Ordinance, under the control

              of the said Board other than Commissioners of Income Tax

              (Appeals).”;


(28)   in section 231A, for sub-section (1), the following shall be substituted,

       namely:-


       “(1)   Every banking company shall deduct tax at the rate specified in

              Division VI of Part IV of the First Schedule, if the payment for

              cash withdrawal, or the sum total of the payments for cash

              withdrawal in a day, exceeds twenty-five thousand rupees.”;



                                                                             79
(29)   in section 233, in sub-section (1), the word “resident” shall be omitted;

       and


(30)   in the First Schedule,-


       (i)    in Part I,


              (a)     in Division-I,–


                      (i)     in clause (1),–


                              (a)   for the word “clauses”    the word “clause”

                                    shall be substituted;


                              (b)   the word, brackets and figure “and (2)” shall

                                    be omitted; and


                              (c)   for the Table the following shall be

                                    substituted, namely:-


                                                      TABLE

                       S. No.           Taxable income                      Rate of

                                                                             tax.

                        (1)                     (2)                           (3)

                       1.     Where the taxable income does not exceed        0%

                              Rs.100,000

                       2      Where the taxable income exceeds              0.50%



                                                                              80
     Rs.100,000 but does not exceed

     Rs.110,000

3    Where the taxable income exceeds   1.00%

     Rs.110,000 but does not exceed

     Rs.125,000

4.   Where the taxable income exceeds   2.00%

     Rs.125,000 but does not exceed

     Rs.150,000

5.   Where the taxable income exceeds   3.00%

     Rs.150,000 but does not exceed

     Rs.175,000

6.   Where the taxable income exceeds   4.00%

     Rs.175,000 but does not exceed

     Rs.200,000

7.   Where the taxable income exceeds   5.00%

     Rs.200,000 but does not exceed

     Rs.300,000

8.   Where the taxable income exceeds   7.50%

     Rs.300,000 but does not exceed

     Rs.400,000

9.   Where the taxable income exceeds   10.00%

     Rs.400,000 but does not exceed



                                          81
                    Rs.500,000

               10. Where the taxable income exceeds                 12.50%

                    Rs.500,000 but does not exceed

                    Rs.600,000

               11. Where the taxable income exceeds                 15.00%

                    Rs.600,000 but does not exceed

                    Rs.800,000

               12. Where the taxable income exceeds                 17.50%

                    Rs.800,000 but does not exceed

                    Rs.10,00,000

               13. Where the taxable income exceeds                 21.00%

                    Rs.10,00,000 but does not exceed

                    Rs.13,00,000

               14. Where the taxable income exceeds                 25.00%

                    Rs.13,00,000

                            Provided that where income of a woman

                     taxpayer is covered by this clause, no tax shall be

                     charged if the taxable income does not exceed

                     Rs.125,000/-.”


(ii)   in clause (1A),-


       (a)    for the Table the following shall be substituted, namely,-


                                                                      82
          TABLE

S. No.      Taxable income                Rate of

                                           tax.

(1)                (2)                      (3)

1.    Where the taxable income does not    0%

      exceed Rs.150,000

2     Where the taxable income exceeds    0.25%

      Rs.150,000 but does not exceed

      Rs.200,000

3.    Where the taxable income exceeds    0.50%

      Rs.200,000 but does not exceed

      Rs.250,000

4.    Where the taxable income exceeds    0.75%

      Rs.250,000 but does not exceed

      Rs.300,000

5.    Where the taxable income exceeds    1.50%

      Rs.300,000 but does not exceed

      Rs.350,000

6.    Where the taxable income exceeds    2.50%

      Rs.350,000 but does not exceed

      Rs.400,000

7.    Where the taxable income exceeds    3.50%




                                              83
      Rs.400,000 but does not exceed

      Rs.500,000

8.    Where the taxable income exceeds   4.50%

      Rs.500,000 but does not exceed

      Rs.600,000

9.    Where the taxable income exceeds   6.00%

      Rs.600,000 but does not exceed

      Rs.700,000

10.   Where the taxable income exceeds   7.50%

      Rs.700,000 but does not exceed

      Rs.850,000

11.   Where the taxable income exceeds   9.00%

      Rs.850,000 but does not exceed

      Rs.950,000

12.   Where the taxable income exceeds   10.00%

      Rs.950,000 but does not exceed

      Rs.1,050,000

13.   Where the taxable income exceeds   11.00%

      Rs.1,050,000 but does not exceed

      Rs.1,200,000

14.   Where the taxable income exceeds   12.50%

      Rs.1,200,000 but does not exceed

      Rs.1,500,000



                                             84
15.   Where the taxable income exceeds           14.00%

      Rs.1,500,000 but does not exceed

      Rs.1,700,000

16.   Where the taxable income exceeds           15.00%

      Rs.1,700,000 but does not exceed

      Rs.2,000,000

17.   Where the taxable income exceeds           16.00%

      Rs.2,000,000 but does not exceed

      Rs.3,150,000

18.   Where the taxable income exceeds           17.50%

      Rs.3,150,000 but does not exceed

      Rs.3,700,000,

19.   Where the taxable income exceeds           18.50%

      Rs.3,700,000 but does not exceed

      Rs.4,450,000,

20.   Where the taxable income exceeds           19.00%

      Rs.4,450,000 but does not exceed

      Rs.8,400,000,

21.   Where the taxable income exceeds           20.00%

      Rs.8,400,000.

             Provided that where income of a woman

      taxpayer is covered by this clause, no tax shall be




                                                      85
                             charged if the taxable income does not exceed

                             Rs.200,000/-.”;


             (iii)   clause (2), shall be omitted;


(b)     in Division III, in clause (a), after the word “company”, occurring for

        the second time, the words “or any other resident company” shall be

        inserted;


(c)     after Division V, the following new Division shall be added, namely,-


                                   “DIVISION VI

                             INCOME FROM PROPERTY


             The rate of tax to be paid under section 15 shall be 5% of the

             gross amount of rent received.”;


      (ii)   in Part III,-


             (a)     for Division I, the following shall be substituted, namely:-


                                     “DIVISION-I

                                  PROFIT ON DEBT


                     The rate of tax to be deducted under section 151 shall

                     be 10% of the yield or profit paid.”;


             (b)     for Division II, the following shall be substituted, namely:-


                                               “Division II

                                                                               86
                              Payments to non-residents”


                (1)    The rate of tax to be deducted from a payment

                       referred to in sub-section (1A) of section 152 shall

                       be 6% of the gross amount payable.”;


               (2)     The rate of tax to be deducted under sub-section

                       (2) of section 152 shall be 30% of the gross

                       amount paid.


        (c)    in Division III;


               (i)     for clause (2), the following shall be substituted,

                       namely:-


                       “(2)       the rate of tax to be deducted from a

                       payment referred to in clause (b) of sub-section

                       (1) of section 153 shall be 6% of the gross

                       amount payable.”;


               (ii)    clause (4) shall be omitted; and


        (d)    in Division IV, in clause (1), for the brackets, figures and

               word “(1) or (3)”, the brackets, figures, commas, word

               and letters “(1), (3), (3A) or (3B)” shall be substituted;

               and


(iii)   in Part IV,-


                                                                             87
             (a)     for Division II, the following shall be substituted.


                                     “DIVISION–II


                            BROKERAGE AND COMMISSION


                     The rate of collection under sub-section (1) of section

                     233 shall be 10% of the amount of the payment”;


       (b)   in Division IIA, the figure “0.005”, wherever occurring, the figure

             “0.01” shall be substituted;


       (c)   in Division VI, for the figure “0.1” the figure “0.2” shall be

             substituted;


(31)   in the Second Schedule-,


       (i)   in Part I,-

             (a)     in clause (4), after the word “vessel” the words and

                     figure “or on Pakistan flag vessels for 183 days or more

                     during a tax year” shall be inserted;


             (b)     for clause (9), the following shall be substituted, namely:-

                     “(9)    Any pension –

                             (i)   received in respect of services rendered by

                             a member of the Armed Forces of Pakistan or

                             Federal Government or a Provincial Government;




                                                                               88
                 (ii)      granted under the relevant rules to the

                 families and dependents of public servants or

                 members of the Armed Forces of Pakistan who

                 die during service.”;


(c)   for clause (66), the following shall be substituted,

      namely:-


      “(66) Any income derived by-


            i.          Abdul Sattar Edhi Foundation, Karachi;


           ii.          Al-Shifa Trust, Rawalpindi.


          iii.          Bilquis Edhi Foundation, Karachi.


          iv.           Fatimid Foundation, Karachi.


           v.           Hamdard Laboratories (Waqf) Pakistan.


          vi.           International     Islamic      Trade   Finance

                        Corporation”.


         vii.           Islamic   Corporation    for   Development   of

                        Private Sector;


         viii.          National Memorial Bab-e-Pakistan Trust for

                        the assessment year commencing on or after

                        the 1st day of July, 1994.


                                                                     89
 ix.    Pakistan       Agricultural         Research      Council,

        Islamabad.


  x.    Pakistan Engineering Council;


 xi.    The corporatized entities of Pakistan Water

        and Power Development Authority from the

        date of their creation upto the date of

        completion of the process of corporatization

        i.e. till the tariff is notified.


xii.    The Institution of Engineers, Pakistan, Lahore.


xiii.   The      Institutions      of       the    Agha        Khan

        Development Network (Pakistan) as contained

        in Schedule 1 of the Accord and Protocol,

        dated November 13, 1994, executed between

        the Government of the Islamic Republic of

        Pakistan and the Agha Khan Development

        Network.


xiv.    The Liaquat National Hospital Association,

        Karachi.


xv.     The     Pakistan      Council        of   Scientific    and

        Industrial Research.




                                                                 90
             xvi.          The Pakistan Water and Power Development

                           Authority established under the Pakistan

                           Water and Power Development Authority Act,

                           1958 (W. P. Act XXXI of 1958).”;


(d)   in clause (57),-


      (i)           in sub-clause (2), after the word and comma

                    “scheme,” the words “or a real estate investment

                    trust” shall be inserted;


      (ii)          in sub-clause (3), in paragraph (ix), for the full

                    stop, at the end, a semicolon shall be substituted

                    and thereafter the following new sub-clause shall

                    be added, namely:-


                    “(x)      the     accumulated      balance   upto   25%

                              received    from   the     voluntary   pension

                              system offered by a pension fund manager

                              under    the   Voluntary    Pension    System

                              Rules, 2005 at the time of eligible person’s:


                              (a)     retirement; or


                              (b)     disability rendering him unable to

                                      work; or




                                                                          91
                     (c)    death by his nominated survivors.”;


(e)   in clause (58), in sub-clause (3), for the words “the

      Central Board of Revenue” the words “Regional

      Commissioner of Income Tax” shall be substituted;


(f)   for clause (72), the following clause shall be substituted,

      namely:-


      “(72) Any profit on debt payable to a non-resident

             person,-


             (i)     in respect of such private loan to be utilized

                     on such project in Pakistan as may be

                     approved by the Federal Government for

                     the purposes of this clause, having regard

                     to the rate of profit and the terms of re-

                     payment of the loan and the nature of

                     project on which it is to be utilized;


             (ii)    on a loan in foreign exchange against

                     export letter of credit which is used

                     exclusively     for    export     of     goods

                     manufactured or processed for exports in

                     Pakistan;


             (iii)   being a foreign individual, company, firm or

                                                                 92
                     association of persons in respect of a

                     foreign loan as is utilized for industrial

                     investment in Pakistan provided that the

                     agreement for such loan is concluded on or

                     after the First day of February 1991, and is

                     duly registered with the State Bank of

                     Pakistan.”;


(g)   in clause (99), after the colon, the following proviso shall

      be inserted, namely:-


                     “Provided that the exemption under this

             clause shall not be available in respect of any

             markup arising from investment in Carry Over

             Trade     (COT)       transactions   in   the   Stock

             Exchanges:”;


(h)   in clause (101), for the figure “2007” the figure “2014”

             shall be substituted;


(i)   after clause (102), the following new clause shall be

      inserted, namely:-


      “(102A)        Income of a person as represents a

      subsidy granted to him by the Federal Government for




                                                                 93
              the purposes of implementation of any orders of the

              Federal Government in this behalf.”;

       (j)    in clause (132), in the second proviso, for the words,

              figures and comma “on or after 22nd October, 2002”, the

              words, figures and commas “between 22nd October,

              2002 and 30th June, 2006”, shall be substituted;

       (k)    in clause (133), in the Explanation, in paragraph (b),

              after the word “operations” the comma and words “,

              locally produced television programs” shall be inserted;


       (l)    in clause 133A,-


              (a)     after the word “Pakistan” the words “along with a

                      room in the Stock Exchange” shall be inserted;

                      and


              (b)     for the figure “2006”, the figure “2007” shall be

                      substituted;


       (m)    clauses (10), (11), (14), (15), (18), (38), (42), (43), (44),

              (45), (46), (47), (48), (49), sub-clauses (xxi) and (xxii) of

              clause (61), (63), (67), (68), (69), (70), (71), (71A), (73),

              (76), (95), (96), (97), (106), (106A), (120) and (137) shall

              be omitted;


(ii)   in Part II,-


                                                                        94
(a)   clauses (11) and (12) shall be omitted;


(b)   for clause (13G), the following clauses shall be

      substituted, namely:-


      “(13G) Tax under section 148 on the following items

      shall be collected @ 1% of their import value as

      increased by customs duty and sales tax, if any levied

      thereon:


                 i.   Capital goods;

              ii.     Cement;

             iii.     Coal;

             iv.      Gold;

              v.      Mobile telephone sets;

             vi.      Silver;

            vii.      Sugar;

            viii.     Wheat;

             ix.      Raw wood;

              x.      Trucks in CBU condition

                      having Gross Vehicle Weight

                      exceeding 5 tons classified

                      under PCT headings

                      8704.3290 and 8704.9090;

             xi.      Dump trucks classified under


                                                               95
        PCT heading 8704;

xii.    Buses classified under PCT

        heading 8702.1090;

xiii.   medical, surgical, dental or

        veterinary machinery/

        equipment, fixtures, fittings,

        furniture and diagnostic kits

        not manufactured locally

        covered by SRO 575(i)/2006

        dated 05.06.2006 under the

        Customs Act, 1969;

xiv.    equipments relating to call

        centers not manufactured

        locally covered by SRO

        575(i)/2006 dated 05.06.2006

        under the Customs Act, 1969;


xv.     Disinfectants used in poultry

        business covered by SRO

        567(i)/2006 dated 05.06.2006

        under the Customs Act, 1969;


xvi.    pre-fabricated structures for

        poultry farms covered by



                                         96
         SRO 567(i)/2006 dated

         05.06.2006 under the

         Customs Act, 1969;


xvii.    live stock and raw materials

         and intermediaries goods as

         used in the manufacture of

         packing material for the

         packing of dairy products

         covered by SRO 567(i)/2006

         dated 05.06.2006 under the

         Customs Act, 1969;


xviii.   ripening chambers, hot water

         treatment plant, vapor hot

         treatment plant, modern cold

         storage, packing machinery,

         power generating sets of 10 –

         25 KVA and battery operated

         fork lift trucks used in

         horticulture and floriculture

         business covered by SRO

         575(i)/2006 dated 05.06.2006

         under the Customs Act, 1969;



                                         97
xix.   processing and packing

       machinery/equipment

       required for fish farming

       covered by SRO 575(i)/2006

       dated 05.06.2006 under the

       Customs Act, 1969;


xx.    medicines for cancer, drugs

       used for kidney dialysis and

       kidney transplant, all type of

       vaccines       for       Hepatitis,

       Interferon       and           other

       medicines for Hepatitis, all

       vaccines/anti-sera,          cardiac

       medicines,     injection      anti-D

       Immunoglobulin, blood bags

       CPDA.1, all medicines for

       HIV/AIDS and all medicines

       for Thalassemia covered by

       SRO        567(i)/2006        dated

       05.06.2006           under      the

       Customs Act, 1969;


xxi.   Broadcasting          equipments



                                              98
                 covered by SRO 575(i)/2006

                 dated 05.06.2006 under the

                 Customs Act, 1969;


        xxii.    News print covered by SRO

                 567(i)/2006 dated 05.06.2006

                 under the Customs Act, 1969


“Explanation.-       Capital   goods    mean    any   plant,

machinery,       equipment,    spares   and    accessories,

classified in Chapters 84, 85 or any other Chapter of the

Pakistan Customs Tariff, required for,-


(i)      the manufacture or production of any goods, and

includes refractory bricks and materials required for

setting up a furnace, catalysts, machine tools, packaging

machinery and equipment, refrigeration equipment,

power generating sets and equipment, instruments for

testing, research and development, quality control,

pollution control and the like;


(ii)     use in mining, agriculture, fisheries, animal

husbandry, floriculture, horticulture, live stock, dairy and

poultry industry;


(iii)    service sector as defined in Customs Act, 1969;


                                                           99
                This clause shall supercede clause (iv) of SRO.593(I)/91

                dated 30th June, 1991.


                (13H) Tax under section 148 on the following items shall

                be collected @ 2% of their import value as increased by

                customs duty and sales tax, if any levied thereon:


                (i)     raw material for steel industry including re-

                        meltable; and re-rollable scrap;


                (ii)    raw material for manufacturer of poultry feed; and


                (iii)   stationery.”;


        (c)     in clause (25), after the word “of”, occurring for the first

                time, the words and commas “sizing, weaving,” shall be

                inserted.


(iii)   in Part III-,

        (a)     in clause (1A), for the figure “65”, the figure “60”, shall be

                substituted;


        (b)     for clause (2), the following shall be substituted, namely,-


                “(2)    The tax payable by a full time teacher or a

                researcher, employed in a non profit education or

                research institution duly recognized by Higher Education

                Commission, a Board of Education or a University

                                                                          100
              recognized by the Higher Education Commission,

              including government training and research institution,

              shall be reduced by an amount equal to 75% of tax

              payable on his income from salary.”;


(iv)   in Part IV-,


       (a)    in clause (11),-


              (i)     in sub-clause (i), after the figure “2003” the words

                      and comma “or a real estate investment trust

                      approved and authorized under the Real Estate

                      Investment Trust Rules, 2006” shall be inserted;


              (ii)    in sub-clause (xv), the word “and” shall be

                      omitted;


              (iii)   in sub-clause (xvi), for the full stop, at the end, a

                      colon and the word “and” shall be substituted and

                      thereafter the following new sub-clause shall be

                      inserted, namely:-


                      “(xvii) a morabaha bank or a financial institution

                      approved by the State Bank of Pakistan or the

                      Securities and Exchange Commission of Pakistan

                      (SECP), as the case may be, for the purpose of




                                                                         101
             Islamic Banking and Finance in respect of

             turnover under a morabaha arrangement.”;


(b)   in clause (33), after the figure “1995” the words, commas

      and figures “or a real investment trust, approved and

      authorized under the Real Estate Investment Trust

      Rules, 2006, established and managed by a REIT

      management company licensed under the Real Estate

      Investment Trust Rules, 2006” shall be inserted;


(c)   in clause (41), for the brackets, words and figures “ (7) of

      section 153”, the brackets, figures, letter and words “(1B)

      of section 152” shall be substituted;


(d)   in clause (56),-


      (i)    for sub-clauses (vi), (vii) and (x) the following shall

             be substituted, namely:-


             “(vi)   Liquefied Petroleum Gas (LPG)


             (vii)   Liquefied Natural Gas (LNG)


             (x)     Radio Navigational Aid Apparatus imported

                     for an airport or on after First January,

                     2006.”;


      (ii)   sub-clauses (xi), (xiii) and (xvi) shall be omitted;


                                                                 102
                     (e)    in clause (57),-


                            (i)    after the word “sections” the figure and comma

                                   “113,” shall be inserted;


                            (ii)   in the proviso, for the full stop, at the end, a colon

                                   shall be substituted and thereafter the following

                                   new proviso shall be inserted, namely:-


                                             “Provided further that the exemption from

                                   application of section 113 shall be available for

                                   the first ten tax years, starting from the tax year in

                                   which the business operations commenced.”;


                    (f)     in clause (60), for the letters “NTISB” the words, bracket

                            and    letters    “Cabinet   Division   (NTISB)”   shall   be

                            substituted;


      (32)   in the Third Schedule, in Part I, in the Table, against serial No. III, after

             the word “items”, comma and words “, machinery and equipment used

             in manufacture of I.T. products” shall be inserted.


18.   Amendment of Ordinance LV of 2001.- In the Microfinance Institutions

Ordinance, 2001 (LV of 2001), the following further amendments shall be made,

namely:-


      (1)    in section (2),-



                                                                                       103
      (a)    for clause (i) the following shall be substituted, namely:-


             “(i)   “microfinance institution” means an institution which

             extends micro credit and allied services to the poor through

             sources other than public savings and deposits;”;


      (b)    after clause (i), as amended aforesaid, the following new clause

             shall be inserted; namely:-


             “(ia) “microfinance bank” means an institution licensed by

             State Bank under this Ordinance to establish and operate as

             microfinance bank;”;


      (c)    in clause (k), after the word “income” the words “during a year

             is less than such minimum limit as the State Bank may, from

             time to time, prescribe” shall be inserted; and


      (d)    in clause (l), after the word “rules” the words “and regulations”

             shall be inserted.


(2)   for section 5, the following shall be substituted, namely:-


      “5.    Name.- (1) No person other than a licensed microfinance bank

      shall use with its name the words “Microfinance Bank” or “MFB” or its

      derivatives or any words or letters which convey that it is a

      microfinance bank.




                                                                           104
      (2)       Any person or company to whom licence has not been granted

      under this Ordinance or the licence granted has been cancelled,

      contravenes, or attempts to contravene or abets the contravention of

      sub-section (1), the chief executive by whatever name called, a

      director, a manager and other officer of the company, and the

      individual and every member of the association or body of individuals

      shall be deemed to be guilty of such contravention and shall be

      punishable with imprisonment for a term which may extend to three

      years or with fine which may extend to one million rupees or with

      both.”.


(3)   in section 6, in sub-section (2),


      (a)   n clause (f), after the word “services” the words and commas

            “and technical, vocational, educational, business development

            and allied services to the poor and micro enterprises” shall be

            inserted; and


      (b)   in clause (s), for the word “securities”, the words and commas

                “and such other marketable securities as the State Bank may,

                from time to time, notify” shall be substituted.


(4)   in section 9, after clause (a), the following new clause shall be

inserted, namely:-




                                                                        105
      “(aa) a region comprising up to five adjacent districts within the same

      Province or any other area wherein this Ordinance is applied with

      necessary adaptations as the case may be;”.


(5)   in section 10, after clause (a), the following new clause shall be

inserted, namely:-


      “(a)   one hundred and fifty million rupees or such higher amount as

      the State Bank may from time to time prescribe for a microfinance

      bank in a region;”.


(6)   for section 12, following shall be substituted, namely:-


      “12.   Existing microfinance institutions.- Any person performing

      the functions of a non-deposit taking microfinance institution may

      make an application to the State Bank on such forms accompanying

      such information and fee, as may be prescribed, for issuance of a

      licence to set up microfinance bank and take deposits.


      (2)    The State Bank may, on receipt of the application, make such

      inquiries as it considers necessary and either grant a licence for a

      specified area as permissible under this Ordinance, subject to such

      conditions as the State Bank may think fit to impose or for reasons to

      be recorded in writing, reject the application for the licence.




                                                                         106
      (3)    Before granting the licence, the State Bank shall satisfy itself by

      an inspection of the books of the microfinance institution, programme,

      project or otherwise, etc , that-


             (a)    the microfinance institution, project or programme, etc.,

             enjoys a good financial health and is and will be in a position to

             meet its liabilities; and


             (b)    the affairs of the microfinance institution are not being,

             and are not likely to be, conducted in a manner detrimental to

             the interests of its members and present or future customers.


      (4)    Where an application of a non-deposit taking microfinance

      institution for grant of licence to take deposits is rejected, the

      concerned microfinance institution may continue operations as a non-

      deposit taking microfinance institution.


      (5)    If the State Bank rejects such an application for grant of licence

      to take deposits, the applicant may, within thirty days from the date of

      the order of the State Bank, prefer an appeal to the Central Board of

      the State Bank and the order passed by the Central Board in this

      respect shall be final.”


(7)   for section 13, the following shall be substituted, namely:-


      “13.    Setting up new microfinance banks.- (1) Any person meeting

      the criteria, to be laid down by the State Bank, may apply for a licence

                                                                            107
      to establish any category of microfinance banks as permissible under

      this Ordinance on such forms accompanying such information and fee

      as may be prescribed from time to time by the State Bank.


      (2)    The State Bank may, if satisfied with the capacity and character

      of the sponsors and Board Members and the overall quality of the

      application, grant a licence for a specified area as permissible under

      this Ordinance subject to such conditions as the State Bank may think

      fit to impose, or otherwise, for reasons to be recorded in writing, reject

      the application for the licence.”.


(8)   after section 13, as amended aforesaid, the following new section

shall be inserted, namely:-


      “13A. Suspension or cancellation of a licence.- (1) The State Bank

      may suspend or cancel a licence granted to a microfinance bank if the

      microfinance bank,-


             (a)    at any time fails to comply with any of the conditions

                    imposed upon it under sub-section (2) of section 12 or

                    sub-section (2) of section 13, as the case may be;


             (b)    at any time fails to pay its liabilities or in the opinion of

                    State Bank the affairs of the microfinance bank are

                    conducted in a manner detrimental to its depositors; or




                                                                             108
       (c)    has furnished false or misleading information in its

              application for a licence; or


       (d)    has gone into liquidation, suspended its business

              activities or ceased to carry on business as microfinance

              bank in Pakistan:


       Provided that before suspending or canceling a licence under

clause (a) or clause (b), the State Bank, unless it is of opinion that the

delay may be prejudicial to the interest of the microfinance bank’s

depositors or the public, shall grant to the microfinance bank on such

terms as it may specify, an opportunity of taking the necessary steps

to comply with or fulfil such conditions.


(2)    No licence shall be suspended or cancelled under sub-section

(1) unless and until the microfinance bank is called upon by a notice in

writing by the State Bank to show cause within fifteen days as to why

its licence should not be suspended or cancelled.


(3)    In the event of suspension or cancellation of a licence; the

microfinance bank concerned shall be notified forthwith and, from the

date of such notification, shall cease to transact any business other

than that required to wind up its affairs with the approval of the State

Bank. The State Bank shall publish notice of such suspension or

cancellation in one leading Urdu language newspaper and one



                                                                      109
      English language newspaper in addition to its publication in the official

      Gazette.


      (4)        The provisions of sub-section (1) shall not prejudice the rights

      or claims of any person against the microfinance bank or of the

      microfinance bank against any person.


      (5)        A microfinance bank aggrieved by the decision of the State

      Bank for suspension or cancellation of its licence may, within thirty

      days from the date on which such decision is communicated to it,

      apply for review to the Central Board of the State Bank.


      (6)        The decision of the State Bank, subject to the result of review

      by the Central Board of the State Bank under sub-section (5), shall be

      final.”.


(9)   in section 16,-


      (a)        in sub-section 2, in the proviso, for the word “three” the word

                 “five” shall be substituted, and


      (b)        in sub-section (6), for the full stop, at the end, a colon shall be

                 substituted and thereafter the following proviso shall be added,

                 namely:-




                                                                                110
              “Provided that in exceptional circumstances the State Bank

              may, for reasons to be recorded, extend such period up to a

              period of another one month.”.


(10)   in section 18,-


       (a)    in sub-section (1), in the Explanation,-


              (i)    in paragraph (b), after the word “both” the commas and

                     words “, or in profit and loss sharing term deposit

                     account with the State Bank” shall be omitted; and


              (ii)   for paragraph (c), the following shall be substituted,

                     namely:-


                     “(c) The State Bank shall monitor the liquidity position

                     through such returns and systems as may be prescribed

                     by it from time to time.”; and


       (b)    for sub-section (2), the following shall be substituted, namely:-


              “(2)   A microfinance bank shall maintain by way of cash

              reserve in cash in current account, opened with the State Bank

              or its agent, a sum equivalent to five per cent of its deposits or

              such percentage as the State Bank may from time to time

              notify. The State Bank shall monitor the reserve position




                                                                             111
             through such returns and systems as may be prescribed by it

             from time to time.”.;


(11)   after section 22, the following new sections shall be inserted, namely:-


             “22A. Power of the State Bank to remove Directors or other

             managerial persons from offices.- (1) Where the State Bank is

             satisfied that -


             (a)    association of any chairman or director or chief

                    executive, by whatever name called, or other officer of a

                    microfinance bank not being lower in rank than a branch

                    manager, is or is likely to be detrimental to the interests

                    of the microfinance bank or its depositors or is otherwise

                    undesirable;


             (b)    in the public interest;


             (c)    to prevent the affairs of a microfinance bank being

                    conducted in a manner detrimental to the interest of its

                    depositors or in a manner prejudicial to the interests of

                    the microfinance bank ;or


             (d)    to secure the proper management of any microfinance

                    bank, it is necessary so to do;




                                                                            112
       the State Bank may, for reasons to be recorded in writing, by

       order, remove from office, with effect from such date as may be

       specified in the order, any chairman or director or chief

       executive officer by whatever name called or other officer, of

       the microfinance bank.


(2)    No order under sub-section (1) shall be made unless the

chairman or director or chief executive or other officer has been given

a reasonable opportunity of making a representation to the State Bank

against the proposed order:


       Provided that if, in the opinion of the State Bank, any delay

shall be detrimental to the public interest or the interest of the

microfinance bank or its depositors, the State Bank may, at the time of

giving the opportunity aforesaid or at any time thereafter and pending

the consideration of the representation aforesaid, if any, by order

direct that-


(a)    the chairman or, as the case may be, director, chief executive

       officer or other officer, shall not, with effect from the date of the

       order,-


       (i)       act as such chairman, director, chief executive officer or

                 other officer of the microfinance bank; or




                                                                         113
       (ii)   in any way, whether directly or indirectly, be concerned

              with, or take part in the management of the microfinance

              bank; and


(b)    any person authorized by the State Bank in this behalf shall act

       as such chairman, director or chief executive officer of the

       microfinance bank.


(3)    Where any order under sub-section (1) is made in respect of a

chairman, director, chief executive officer or other officer of a

microfinance bank, he shall forthwith cease to be a chairman or, as

the case may be, a director, chief executive officer or other officer of

the microfinance bank and shall not in any way, whether directly or

indirectly, be concerned with, or take part in the management of the

microfinance bank or any other microfinance bank for such period not

exceeding three years as may be specified in the order.


(4)    Any person appointed as chairman, director or chief executive

officer under sub-section (2) shall-


       (a)    hold office during the pleasure of the State Bank subject

              to such conditions as may be specified in the order of his

              appointment and, subject thereto, for such period, not

              exceeding three years as the State Bank specify in such

              order; and



                                                                      114
         (b)    not incur any obligation or liability for anything, which is

                done or intended to be done in his capacity as such

                chairman, director or chief executive officer.


(5)      No person removed from office under sub-section (1) shall be

entitled to claim any compensation for the loss or termination of office.


         22B. Power of the State Bank to supersede Board of

         Directors of microfinance banks.- (1) Where the State Bank

         is satisfied that-–


                (a)     association of the Board of Directors, by whatever
                        name called, of a microfinance bank, is or is likely
                        to     be   detrimental   to   the   interests   of   the
                        microfinance bank or its depositors or otherwise
                        undesirable; or

                (b)     for all or any of the reasons mentioned in sub-
                        section (1) of section 22A, it is necessary so to
                        do;

                the State Bank may, for reasons to be recorded in
                writing, by order, supersede the Board of Directors of a
                microfinance bank with effect from such date and for
                such period as may be specified in the order.

(2)      The period of supersession specified in an order under sub-
section (1) may, from time to time, be extended by the State Bank and
the total period of such supersession shall in no case exceed three
years.



                                                                              115
(3)    All powers and duties of the Board of Directors shall, during the
period of supersession, be exercised and performed by such persons
as the State Bank may, from time to time, appoint in this behalf.

(4)    The provisions of sub-sections (2), (3), (4), and (5) of section
22A shall, mutatis mutandis, apply to an order made under sub-
section (1) or sub-section (3).

22C. Limitations.- (1) No order under section 22A or section 22B

shall be made except by the Governor of the State Bank on a report

by a standing committee set up by the State Bank for the purpose.


(2)    Any person or microfinance bank aggrieved by an order made
by the Governor of the State Bank under section 22A or section 22B
may prefer an appeal to the Central Board of Directors of the State
Bank whose decision shall be final.

(3)    No action taken under section 22A or section 22B or sub-
section (2) shall be called in question by or before any court, tribunal
or other authority.

22D. Prosecution of directors, chief executive officers or other

officers.-


Notwithstanding anything contained in section 22A the State Bank

may direct prosecution of a director or chief executive officer by

whatever name called or other officer who, in its opinion, has

knowingly acted in the manner causing loss of depositors’ money or of

the income of the microfinance bank.




                                                                      116
             Explanation.- For the purpose of this section a director, chief

             executive officer or other officer shall be deemed to have acted

             knowingly if he has departed from established banking practices and

             procedures or circumvented the regulations or related restrictions laid

             down by the State Bank of Pakistan from time to time.


      (12)   after section 26, the following new section shall be inserted , namely:-


             “26A. Declaration of fidelity and secrecy.- (1) Every member,

             director, auditor and staff member of the microfinance bank shall,

             before entering upon his office and performance of duties, make a

             declaration of fidelity and secrecy in the form as the State Bank may

             prescribe.


             (2)    Whoever contravenes the declaration of fidelity and secrecy

             shall be punishable with imprisonment for a term which may extend to

             six months, or with fine which may extend to one hundred thousand

             rupees, or up to the extent of loss caused, whichever is higher, or with

             both.”; and


      (13)   in section 30, sub-section (2) shall be omitted.


19.   Amendment of Ordinance XXII of 2002.- In the Public Procurement

Regulatory Authority Ordinance, 2002 (XXII of 2002), the following amendments

shall be made, namely:-


      (1)    after section 21, the following new section shall be inserted, namely:-

                                                                                  117
             “ 21A. Ordinance not to apply to certain bodies corporate, etc.-

             (1) Notwithstanding anything contained in this Ordinance the

             provisions thereof shall not apply to a body corporate, company,

             institution undertaking or establishment specified in the Schedule to

             this Ordinance, which has been privatized pursuant to the Privatization

             Commission Ordinance, 2000 (LII of 2000).


             (2)    The Federal Government may, by notification in the official

             Gazette, amend the Schedule so as to add any entry thereto, modify

             or omit any entry therein.”; and


      (2)    after section 27, the following Schedule shall be added, namely:-


                                  “THE SCHEDULE


                                   [See section 21A]


              1. The Pakistan Telecommunication Company Limited.”.


20.   Amendment in Federal Excise Act, 2005.–          The following amendments

shall be made in the Federal Excise Act, 2005, namely:-


      In the aforesaid Act,–


      (1)    in section (2),–


             (a)    after clause (8), the following new clause shall be inserted,

                    namely:-



                                                                                 118
              “(8a) “due date”, in relation to furnishing a return under section

              4, means the 15th day of the month following the end of the

              month, or such other date as the Federal Government may, by

              notification in the official Gazette, specify.”;


       (b)    after clause (9), the following new clause shall be inserted,

              namely:-


              “(9a) “duty due” means duty in respect of clearances made

              during a month and shall be paid on the last day of that

              month;”;


(2)    in section 3, in sub-section (1), for the word “fifty”, the word “fifteen”

shall be substituted;


(3)    in section 4,–


       (a)    for sub-sections (1) and (2), the following shall be substituted,

              namely:-


              “(1)      At the close of a month every registered person, after

              payment of the amount of duty due from him for the month shall

              furnish not later than the due date a true and correct return in

              such manner and form as may be prescribed by the Board by

              notification in the official Gazette.




                                                                             119
              (2)       Duty shall be deposited in the designated branch of the

              bank on the prescribed challan on the last day of the month

              during which clearances of goods are made:


                        Provided that the Board may, by notification in the official

              Gazette, prescribe any other manner of depositing the duty.”;

              and


      (b)     for sub-section (4), the following shall be substituted, namely:-


              “(4)      A registered person may, subject to approval of the

              Collector of Federal Excise having jurisdiction, file a revised

              return within ninety days of the filing of return under sub-section

              (1), to correct any omission or wrong declaration made

              therein.”;


(4)   in section 5, after sub-section (2), the following new sub-section shall

      be added, namely:-


      “(3)    Notwithstanding anything in sub-sections (1) and (2), the Board

      may, by notification in the official Gazette, prohibit the payment of

      drawback, refund or adjustment of duty upon the exportation of goods

      or any specified goods or class of goods to any specified foreign port

      or territory.”;




                                                                                120
(5)   in section 12, in sub-section (5), for the full stop, at the end, a colon

      shall be substituted and thereafter the following proviso shall be

      added, namely:-


             “Provided that, where the price, at which the goods or class of

      goods are sold, is higher than the price fixed by the Board, the duty

      shall, unless otherwise directed by the Board, be levied and collected

      at such higher price.”;


(6)   in section 18, after sub-section (4), the following new sub-section shall

      be added, namely:-


      “(5)   The Board may, by notification in the official Gazette, specify

      the goods or services in respect of which sales invoice shall be issued

      electronically and prescribe the manner and procedure therein.”;


(7)   in section 31, after sub-section (3), the following new sub-section shall

      be added, namely:-


      “(4)   Notwithstanding anything contained in sub-section (3) or any

      other provision of the Act or any other law for the time being in force

      and notwithstanding any decision or judgment of any forum, authority

      or court, the time for adjudication in all the cases pending as on 30th

      June, 2006, shall be deemed always to have been extended upto 31st

      December, 2006, from the date on which the time limit prescribed

      under sub-section (3), expires.”;


                                                                           121
(8)   section 33 shall be numbered as sub-section (1) of that section, and

      thereafter the following new sub-sections shall be added, namely:-


      “(2)   The Collector (Appeals) may, after giving both parties to the

      appeal an opportunity of being heard, pass such order as he thinks fit,

      confirming, varying, altering, setting aside or annulling the decision or

      order appealed against.


      (3)    In deciding an appeal, the Collector (Appeals) may make such

      further inquiry as may be necessary provided that he shall not remand

      the case for de novo consideration.”;


(9)   in section 34,–


      (a)    in sub-section (3), for the words “Deputy Collector”, the words

             and comma “Additional Collector, authorized by the Collector”

             shall be inserted;


      (b)    in sub-section (9), for the proviso, the following shall be

             substituted, namely:-


             “Provided that, if the amount of duty is reduced as a result of

             judgment in the reference by the High Court, and any amount

             of duty is found refundable, the High Court may, on application,

             within thirty days of the receipt of such judgment, by an

             Additional Collector authorized by the Collector stating therein

             that he wants to prefer petition for leave to appeal to the

                                                                           122
             Supreme Court, make an order authorizing the Collector to

             postpone the refund until the disposal of the appeal by the

             Supreme Court.”;


       (c)   in sub-section (12), after the word “the”, the words “Additional

             Collector authorized by the” shall be inserted; and


       (d)   after sub-section (12), the following new sub-section shall be

             added, namely:-


             “(13) Notwithstanding anything contained in any provision of

             this Act, where any reference or appeal was filed with the

             approval of Collector by the officer of lower rank than the

             Collector, and the reference or appeal is pending before an

             appellate forum or the Court, such reference or appeal shall

             always be deemed to have been so filed by the Collector.”;


(10)   in section 38,–


       (a)   in marginal note, for the word “Alternate”, the word “Alternative”

             shall be substituted;


       (b)   in sub-section (1), after the word “excise” appearing for the first

             time the words and comma “pending before an Appellate

             authority or the High Court,” shall be inserted;


       (c)   for sub-section (2) the following shall be substituted, namely:-



                                                                            123
              “(2)       The Board may, after examination of the application

              of a registered person, appoint a committee consisting of an

              officer of sales tax not below the rank of an Additional Collector

              and two persons from the notified panel comprising of retired

              Judge not below district and Sessions Judge, chartered or cost

              accountants, advocates, representatives of trade bodies or

              associations, or any other reputable taxpayers, for the

              resolution of dispute.”; and


       (d)    for sub-section (5), the following shall be substituted, namely:-


              “(5) The registered person may make payment of duty and

              other taxes as determined by the Board in its order under sub-

              section (4), and such order of the Board shall be submitted

              before the forum, tribunal or the Court where the matter is sub-

              judice, for consideration and orders as deemed appropriate.”;


(11)   in section 45, after sub-section (2), the following new sub-section shall

       be added, namely:-


       “(3)   The Board may, by notification in the official Gazette, for the

       purpose to monitor production or manufacture of any goods, specify

       the manner and procedure for appointment and posting of technical

       staff and installation, operation, maintenance of close circuit T.V

       system anywhere in the factory premises.”;



                                                                             124
(12)   in the First Schedule,–


       (i)   in Table-I, in column (1),–


             (a)    for serial numbers 9, 10 and 11 and the entries relating

                    thereto in columns (2) and (3), the following shall be

                    substituted, namely:-


                     “9    Locally     produced     24.02   Sixty-three
                           cigarettes if their              per cent of the
                           retail price exceeds             retail price.
                           fourteen rupees per
                           ten cigarettes.

                     10    Locally     produced     24.02   Two      rupees
                           cigarettes if their              and        sixty-
                           retail price exceeds             three paisas
                           six    rupees     and            per          ten
                           seventeen paisas                 cigarettes plus
                           per ten cigarettes               sixty-nine per
                           but      does      not           cent
                           exceed       fourteen            incremental
                           rupees      per    ten           rupee or part
                           cigarettes.                      thereof.

                     11    Locally      produced    24.02   Two     rupees
                           cigarettes if their              and       sixty-
                           retail price does not            three paisas
                           exceed six rupees                per         ten
                           and        seventeen             cigarettes.”;
                           paisas      per   ten
                           cigarettes.

             b)     against serial numbers 22 and 23, in column (3), for the

                    words “Seven rupees and fifteen paisa per litre”, the

                    words “Ten per cent of the retail price”, shall be

                    substituted;




                                                                                125
       (c)    against serial number 25, in column (3), for the word

              “Five”, the word “Two” shall be substituted;


       (d)    for serial number 38 and the entries relating thereto in

              columns (2) and (3), the following shall be substituted,

              namely:-


             “38    Petroleum Bitumen             27.13,   Two
                    (Bitumen and Asphalt)         27.14    thousand
                    including bituminous          and      rupees per
                    mixtures.                     27.15    metric
                                                           tonne.”;

(ii)   in Table-II, in column (1),–


       (a)    for serial number 3 and the entries relating thereto in

              columns (2) and (3), the following shall be substituted,

              namely:-


                   “3   Facilities for travel         98.03

                        (a)     Services            9803.1000 Fifteen per
                        provided or rendered                  cent of the
                        in respect of travel by               charges.
                        air of passenger
                        within the territorial
                        jurisdiction of
                        Pakistan.

                        (b)     Services            9803.1100 Fifteen per
                        provided or rendered                  cent of the
                        in respect of travel by               charges.”;
                        air of passenger
                        embarking on
                        international journey
                        from Pakistan.




                                                                        126
(b)   for serial number 6 and the entries relating thereto in

      column (2), (3) and (4), the following shall be substituted,

      namely:-


       “6     Telecommunication                   98.12
              services

              (i)      Telephone             9812.1000 Fifteen per
                       services                        cent of the
                                                       charges

              (ii)     Fixed line voice      9812.1100 Fifteen per
                       telephone service               cent of the
                                                       charges

              (iii)    Wireless              9812.1200 Fifteen per
                       telephone                       cent of the
                                                       charges

              (iv)     Cellular telephone    9812.1210 Fifteen per
                                                       cent of the
                                                       charges

              (v)      Wireless Local        9812.1220 Fifteen per
                       Loop telephone                  cent of the
                                                       charges

              (vi)     Video telephone       9812.1300 Fifteen per
                                                       cent of the
                                                       charges

              (vii)    Payphone cards        9812.1400 Fifteen per
                                                       cent of the
                                                       charges

              (viii)   Pre-paid calling      9812.1500 Fifteen per
                       cards                           cent of the
                                                       charges

              (ix)     Voice mail service    9812.1600 Fifteen per
                                                       cent of the
                                                       charges

              (x)      Messaging             9812.1700 Fifteen per
                                                       cent of the

                                                              127
         service                         charges

(xi)     Short Message        9812.1710 Fifteen per
         service (SMS)                  cent of the
                                        charges

(xii)    Multimedia           9812.1720 Fifteen per
         message service                cent of the
         (MMS)                          charges

(xiii)   Bandwidth            9812.2000 Fifteen per
         services─                      cent of the
                                        charges

         (a) Copper line      9812.2100 Fifteen per
             based                      cent of the
                                        charges

         (b) Fibre-optic      9812.2200 Fifteen per
             based                      cent of the
                                        charges

         (c) Co-axial cable   9812.2300 Fifteen per
             based                      cent of the
                                        charges

         (d) Microwave        9812.2400 Fifteen per
             based                      cent of the
                                        charges

         (e) Satellite        9812.2500 Fifteen per
             based                      cent of the
                                        charges

(xiv)    Telegraph            9812.3000 Fifteen per
                                        cent of the
                                        charges

(xv)     Telex                9812.4000 Fifteen per
                                        cent of the
                                        charges

(xvi)    Telefax              9812.5000 Fifteen per
                                        cent of the
                                        charges

(xvii)   Store and forward    9812.5010 Fifteen per
                                        cent of the

                                            128
                       fax services                    charges

             (xviii)   Audiotext            9812.9000 Fifteen per
                       services                       cent of the
                                                      charges

             (xix)     Teletext services    9812.9100 Fifteen per
                                                      cent of the
                                                      charges

             (xx)      Trunk radio          9812.9200 Fifteen per
                       services                       cent of the
                                                      charges

             (xxi)     Paging services      9812.9300 Fifteen per
                                                      cent of the
                                                      charges

             (xxii)    Voice paging         9812.9400 Fifteen per
                       services                       cent of the
                                                      charges

             (xxiii)   Radio paging         9812.9410 Fifteen per
                       services                       cent of the
                                                      charges

             (xxiv)    Vehicle tracking     9812.9490 Fifteen per
                       services                       cent of the
                                                      charges

             (xxv)     Burglar alarm        9812.9500 Fifteen per
                       services                       cent of the
                                                      charges.”;

(c)   for serial number 7 and the entries relating thereto in

      columns (2), (3) and (4), the following shall be

      substituted, namely:-


       “7    Services provided or          9813.1000
             rendered in respect of
             insurance to a policy
             holder by an insurer,
             including a re-insurer



                                                          129
              (i) Goods insurance         9813.1100   Five per
                                                      cent of
                                                      the gross
                                                      premium
                                                      paid.



              (ii)    Fire insurance      9813.1200   Five per
                                                      cent of
                                                      the gross
                                                      premium
                                                      paid.

              (iii)   Theft insurance     9813.1300   Five per
                                                      cent of
                                                      the gross
                                                      premium
                                                      paid.

              (iv)    Marine insurance    9813.1400   Five per
                                                      cent of
                                                      the gross
                                                      premium
                                                      paid.

              (v)     Other insurance     9813.1500   Five per
                                                      cent of
                                                      the gross
                                                      premium
                                                      paid.”;

(d)   for serial number 8 and the entries relating thereto in

      columns (2), (3) and (4), the following new serial

      numbers and the entries relating thereto in columns (2),

      (3) and (4) shall be substituted, namely:-


       “8     Service provided     9813.4000
              or rendered by
              banking
              companies in
              relation to:



                                                          130
Letter of credit      9813.4100   Five per cent
                                  of the
                                  charges.

Guarantee             9813.4200   Five per cent
                                  of the
                                  charges.

Brokerage             9813.4300   Five per cent
                                  of the
                                  charges.

Issuance of pay       9813.4400   Five per cent
order and                         of the
demand drafts                     charges.

Bill of exchange      9813.4500   Five per cent
charges                           of the
                                  charges.

Transfer of           9813.4600   Five per cent
money including                   of the
telegraphic                       charges.
transfer, mail
transfer and
electronic transfer

Providing bank        9813.4700   Five per cent
guarantees                        of the
                                  charges.

Bill discounting      9813.4800   Five per cent
commission                        of the
                                  charges.

Safe deposit          9813.4900   Five per cent
lockers fee                       of the
                                  charges.

Safe vaults           9813.4910   Five per cent
                                  of the
                                  charges.

Credit and debit      9813.5000   Five per cent
card issuance,                    of the
processing and                    charges.
renewal


                                             131
                               Commission and        9813.6000   Five per cent
                               brokerage on                      of the
                               foreign exchange                  charges.
                               dealings

                     9         Service provided      9813.9000   Five per cent
                               or rendered by a                  of the
                               foreign exchange                  charges.
                               broker including
                               any authorized
                               dealer of foreign
                               exchange to a
                               customer

                     10        Cable TV              9819.9000   Twenty-five
                               operators                         rupees per
                                                                 connection.

                     11        Franchise             9823.0000   Five per cent
                               services                          of the
                                                                 charges.”;
                                                                 and

(13)   in the Third Schedule, in Table II, for serial number 2 in column (1)

       and the entries relating thereto in columns (2) and (3), the following

       shall be substituted, namely:-


                         “S.            Description of Goods            Heading/sub-
                         No                                               heading
                                                                          number

                         (1)                       (2)                         (3)

                          2     Telecommunication services:            Respective
                                                                       sub-headings
                                                                       of 98.12.”.
                                (i) Internet services whether dialup
                                or broadband including email
                                services,    Data     Communication
                                Network services (DCNS) and Value
                                added data services

                                (ii) Such charges payable on the
                                international leased lines or
                                bandwidth services used by—

                                                                               132
                                        (a) software exporting firms
                                        registered with the Pakistan
                                        Software Exporting Board; and

                                        (b) data and internet service
                                        providers licensed   by   the
                                        Pakistan    Telecommunication
                                        Authority

                                    (iii) Such amounts received by the
                                    Long Distance International license
                                    holders      including     Pakistan
                                    Telecommunication         Company
                                    Limited on International incoming
                                    calls under agreements with the
                                    foreign           telecommunication
                                    companies


21.   Amendment of Act V of 1898:-In the Code of Criminal Procedure, 1898 (Act

V of 1898), hereinafter referred to in said Code, the following further amendments

shall be made, namely:-


      (1)    after section 14, the following new section shall be inserted, namely:-


             “14A.- Appointment of Special Magistrates.- (1) Notwithstanding
             anything contained in this Code or any other law for the time being in
             force or any judgment of any court including superior courts, the
             Provincial Government may appoint Special Magistrates with the
             powers of a Magistrate First Class for the trial of offences relating to
             price control under any Provincial law or Federal law for the time being
             in force.

             (2)    The Provincial Government or any officer authorized by the
             Provincial Government in this behalf may, from time to time, define
             local areas within which such Magistrates may exercise all or any of
             the powers with which they may respectively be invested under this

                                                                                  133
       Code or under any Provincial law or Federal law relating to price
       control.”;

(2)    in section 17, after the figure “14” the comma, figure and letter “,14A”

shall be inserted;


(3)    in section 408, after the word “Magistrate” the comma and words

“,Special Magistrate” shall be inserted.


                                 *****




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                    DECLARATION UNDER THE PROVISIONAL


                COLLECTION OF TAXES ACT, 1931(XVI OF 1931)


       The provisions of sub-clause (46) of clause 8 and sub-clause (21) of clause

16 of this Bill shall have effect, for the purpose of this declaration and of the

provisions of Provisional Collection of Taxes Act, 1931 (XVI of 1931) as if they were

provisions for imposition of duties of customs and exemption of sales tax or

withdrawal thereof respectively and it is hereby declared accordingly in terms of

section 3 of the Act that it is expedient in the public interest that the provisions of the

said clauses have effect on 6th June, 2006 under the Act, and for the purposes of

above declaration the provisions of paragraph (i) of sub-clause (12) of clause 20 for

increase or decrease of excise duty shall take immediate effect under that Act.




                    STATEMENT OF OBJECTS AND REASONS


       The purpose of this Bill is to make financial provisions for the year beginning

on the first day of July, 2006. Various provisions have been explained in the Notes

on clauses.




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