PESHAWAR - All Pakistan Textile Mills Association (Aptma), Khyber Pakhtunkhwa chapters has challenged the levy of cess on imported cotton in Peshawar High Court (PHC) through its lawyer Qazi Ghulam Dastgir.

The said cess is challenged by M/S Saif Textile Mills, M/S Mezan Textile Mills. M/S Rehman Cotton Mills, M/S Gadoon Textile Mills, M/S Kohat Textile Mills and M/S A.J Textile Mills and arrayed the respondents. In the said petition, the Ministry of Textile Industry, Directorate of Cotton Cess Management (PCCC) and Pakistan Central Cotton Committee have been made respondents. Through their petition, the petitioners said that they are engaged in manufacturing and value addition of textile, yarns and allied products, having their respective manufacturing units, mills and factories at various industrial areas of Khyber Pakhtunkhwa.

The petitioners in order to run their respective units used the cotton as raw material produced locally or imported and in addition to this all the petitioner contended that they are running their units in these adverse situation of security and terrorism, electricity short fall. The petitioners said that under Section 3 of the Cotton Cess Act, 1923, it shall be levied on all cotton exported from Pakistan or consumed in mills in Pakistan and in the said section the scope of Cotton Cess is not included. In addition to this, the petitioners took the ground that as per precedents the Cess is like an excise duty and as per law excise duty could not be charged on imported items, including any raw material.

The petitioners contended that cess on imported cotton is levied through making the amendment in the Cotton Cess Rules and a note was deleted on Form A. The petitioner took the ground that no tax, cess or surcharge should be levied through rules or sub-ordinate legislation so this cess is illegal and unlawful.

The petitioners prayed for the acceptance of their petition and impugning levy of cess on imported cotton and its demand and collection since the date of amendment in the rules.