Federal · Act · 2005

Federal Excise Act, 2005 (Same as on the official website of FBR dated 30-06-2025)

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The Federal Excise Act, 2005

As amended up to 30th June, 2025

The amendments made through

Finance Act, 2025

have been shown in Red

The Federal Excise Act, 2005

FIRST SCHEDULE 72 Table-I 72-82 Table-II 83-87 Table-III 88 SECOND SCHEDULE 89 THIRD SCHEDULE 90 Table-I 90-102 Table-II 103-105 FOURTH SCHEDULE [Omitted] 105

The Federal Excise Act, 2005

CHAPTER I PRELIMINARY

Section 1. Short title, extent and commencement

(1) This Act may be called the Federal Excise Act, 2005,

2. It extends to the whole of Pakistan

3. It shall come into force on 1st day of July, 2005.

Section 2. Definitions

In this Act, unless there is anything repugnant in the subject or context,—

(1) “adjudicating authority” means any authority competent to pass any order or decision under this Act or the rules made there under , but does not include the Board or Appellate Tribunal;

(2) “adjustment” means deduction of amount of duty paid on goods used in the manufacture or production of other goods from the amount of duty payable on such other goods in the prescribed manner;

1[(3) “Appellate Tribunal” means the Appellate Tribunal Inland Revenue established under section 130 of the Income Tax Ordinance, 2001 (XLIX of 2001);] 2[(4) “Board” shall have the same meaning as defined under clause

(8) of section 2 of the Income Tax Ordinance, 2001 (XLIX of 2001).”;

1 Clause (3) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 june 2010 as Parliament did not approve it. Originally this amendme nt was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

2 Substituted vide Finance Act, 2024.

The Federal Excise Act, 2005

1[(4A) “Chief Commissioner” means a person appointed as the Chief Commissioner Inland Revenue under section 29;] 2[(5) “Commissioner” means a person appointed as a Commissioner Inland Revenue under section 29;]

(6) “conveyance” means any means of transport used for carrying goods or passengers such as vessel, aircraft, vehicle or animal etc.;

(7) “default surcharge” means surcharge levied under section 8;

(8) “distributor” means a person appointed by a manufacturer in or for a specified area to purchase goods from him for sale to a wholesale dealer in that area;

3[(8a) “due date”, in relation to furnishing a return under section 4, means the 15 th day of the month following the end of the month, or such other date as the 4[Board] may, by notification in the official Gazette, specify 5[and different dates may be specified for furnishing of different parts or annexures of the return]. 6[(8b) “dutiable goods” means all excisable goods specified in the First Schedule except those which are exempt under section 16 of the Act;

(8c) “dutiable supply” means a supply of dutiable goods made by a manufacturer other than a supply of goods which is exempt under section 16 of the Act;

1 Clause (4A) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 june 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 2 Clause (5) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, Promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

3 Inserted vide Finance Act, 2006.

4 Substituted for the words “Federal Government” by Finance Act, 2017 5 Expression for full stop at end substituted through Finance Act, 2016.

6 Inserted vide Finance Act, 2007.

The Federal Excise Act, 2005

(8d) “dutiable services” means all excisable services specified in the First Schedule except those which are exempt under section 16 of the Act;

(9) “duty” means any sum payable under the provisions of this Act or the rules made there under and includes the default surcharge and the duty cha rgeable at the rate of zero per cent 1[excluding fee and service charges imposed and collected under section 49;] 2(9a) “duty due” means duty in respect of supplies made or services provided or rendered during a month and shall be paid at the time of filing of return;

(10) “establishment” includes an undertaking, firm or company, whether incorporated or not, an association of persons and an individual;

(11) “factory” means any premises, including the precincts thereof, wherein or in any part of which goods are manufactured, or wherein or in any part of which any manufacturing process connected with the production of the goods is being carried on or is ordinarily carried on;

3[4[(12)] “Officer of Inland Revenue” means any person appointed by the Board as officer of Inland Revenue under section 29 or any person (including an officer of the Provincial Government) entrusted by the Board with any of the powers of an officer of Inland Revenue under this Act or rules made there under;]

1 Words inserted by Finance Act, 2022.

2 Inserted vide Finance Act, 2008.

3 Clause (12) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The Finance Ordinance states clause 12 to be substituted by “(12A)”, however (12a) is already present in the Finance Ordinance. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No . III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was mad e through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 4 Clause (12A) re-numbered as (12) by Finance Act, 2012.

The Federal Excise Act, 2005

1(12a) “franchise” means an authority given by a franchiser under which the franchisee is contractually or otherwise granted any right to produce, manufacture, sell or trade in or do any other business activity in respect of goods or to provide service or to undertake any process identified with franchiser against a fee or consideration including royalty or techni cal fee, whether or not a trade mark, service mark ,trade name, logo, brand name or any such representation or symbol, as the case may be, is involved;”

(13) “goods” means goods leviable to excise duty under this Act or as specified in the First Schedule and includes goods manufactured or produced in non-tariff area and brought for use or consumption to tariff area;

(14) “goods insurance” includes fire, marine, theft, accident and other such miscellaneous insurance;

(15) “import” and “export” mean respectively bringi ng into, and taking out of Pakistan by sea, land or air and shall be deemed to have always been so defined;

2(15a) “KIBOR” means Karachi Inter Bank Offered Rate prevalent on first day of each quarter of the financial year;”

(16) “manufacture” includes,—

(a) any process incidental or ancillary to the completion of a manufactured product;

(b) any process of re -manufacture, remaking, reconditioning or repair and the processes of packing or repacking such product, and, in relation to tobacco, includes the preparation of cigarettes, cig ars, cheroots, biris, cigarette and pipe or hookah tobacco, chewing tobacco or 3[snuff, or preparation of unmanufactured tobacco by drying, cutting and thrashing of raw tobacco,] and the word

1 Clause (12a) inserted by Finance Act, 2008.

2 Inserted vide Finance Act, 2009.

3 Substituted for “snuff,” by Finance Act, 2011.

The Federal Excise Act, 2005

"manufacturer" shall be construed accordingly and shall include,–

(i) any person who employs hired labour in the production or manufacture of goods; or

(ii) any person who engages in the production or manufacture of goods on his own account if such goods are intended for sale; and

(c) any person wh o, whether or not he carries out any process of manufacture himself or through his employees or any other person, gets any process of manufacture carried out on his behalf by any person who is not in his employment:

Provided that any person so deal ing in goods shall be deemed to have manufactured for all purposes of this Act, such goods in which he deals in any capacity whatever; [(16a) “non-fund banking services” includes all non -interest based services provided or rendered by the banking companie s or non-banking financial institutions against a consideration in the form of a fee or commission or charges;”;]

(17) “non-tariff area” means Azad Jammu and Kashmir, Northern Areas and such other territories or areas to which this Act does not apply;

(18) “person” includes a company, an association, a body of individuals, whether incorporated or not, a public or local authority, a Provincial Government or the Federal Government;

(19) “prescribed” means prescribed under this Act or by rules made there under;

1[(19a) “property developers or promoters” means persons engaged in

1 Inserted vide Finance Act, 2008.

The Federal Excise Act, 2005

development of purchased or leased land for conversion into residential or commercial plots or construction of residential or commercial units for sale;]

(20) “registered person” me ans a person who is registered or is required to be registered under this Act provided that a person who is not registered but is required to be registered shall not be entitled to any benefit or privilege under this Act or rules made there under, unless he is registered and such benefit and privilege, unless allowed by Board, shall be confined to period of registration;

(21) “sale” and “purchase” with their grammatical variations and cognate expressions, mean any transfer of the possession of goods or rendering and providing of services by one person to another in the ordinary course of trade or business for cash or deferred payment or other consideration; 1[(21a) “sales tax mode” means the manner of collection and payment under the Sales Tax Act, 1990, and rules made there under, of the duties of excise chargeable under this Act specified to be collected and paid as if such duties were tax chargeable under section 3 of the said Act and all the provisions of that Act and rules, notifications, orders and instructions made or issued there under shall, mutatis mutandis, apply to the excise duty so chargeable;]

(22) “Schedule” means the schedule appended to this Act;

(23) “services” means services, facilities and utilities leviable to excise duty under this Act or as specified in the First Schedule read with Chapter 98 of the Pakistan Customs Tariff, including the services, facilities and utilities originating from Pakistan or its tariff area or terminating in Pakistan or its tariff area;

2[(23a) “supply” includes sale, lease or other disposition of goods and

1 Inserted vide Finance Act, 2007.

2 Inserted vide Finance Act, 2007.

The Federal Excise Act, 2005

shall include such transaction as the 1[Board, with the approval of the Federal Minister-in-charge,] may notify in the official Gazette from time to time;]

(24) “tariff area” means area other than the non-tariff area; 2[(24A) “un-manufactured tobacco” means tobacco useable for manufacture of cigarettes as manufactured by Green Leaf Threshing Units after processing and conversion of tobacco green leaf;] 3[(24B) “whistleblower” means whistleblower as defined in section 42D of the Federal Excise Act, 1990;]

(25) “wholesale dealer” means a person who buys or sells goods wholesale for the purpose of trade or manufacture, and includes a broker or commiss ion agent who, in addition to making contracts for the sale or purchase of goods for others, stocks such goods belongin g to others as an agent for the purpose of sale; and

(26) “zero-rated” means duty of Federal excise levied and charged at the rate of zero per cent under section 5 of this act.

1 The words “Federal Government” substituted by Finance Act, 2019. 2 New clause 24A inserted by Finance Supplementary (Amendment) Act, 2018 3 Earlier clause 24A re-numbered as clause 24B by Finance Supplementary (Amendment) Act, 2018

The Federal Excise Act, 2005

CHAPTER II

LEVY, COLLECTION AND PAYMENT OF DUTY

Section 3. Duties specified in the First Schedule to be levied

(1) Subject to the provisions of this Act and rules made there under, there shall be levied and collected in such manner as may be prescribed duties of excise on,—

(a) goods produced or manufactured in Pakistan;

(b) goods imported into Pakistan 1[, irrespective of their final destination in territories of Pakistan];

(c) such goods as the 2[Federal Government] may, by notification in the official Gazette, specify, as are produced or manufactured in the non -tariff areas and are brought to the tariff areas for sale or consumption therein; 3[***] 4[(d) services provided in Pakistan including the services originated outside but rendered in Pakistan; 5[and] 6[(e) any item not covered in clause (a) to (d) above and specified in the First Schedule.] at the rate of 7[fifteen] per cent ad valorem except the goods and services specified in the Firs t Schedule, which shall be charged to Federal excise duty as, and at the rates, set-forth therein.

(2) Duty in respect of goods imported into Pakistan shall be levied and collected in the same manner and at the same time as if it were a duty of customs payable under the Customs Act, 1969 (IV of 1969), and the provisions of the said Act including section 31A thereof shall apply.

1 The expression inserted by Finance Act, 2017. 2 Words “Federal Government” substituted by Finance Act, 2018. 3 Word omitted by Finance Act, 2023

4 Inserted vide Finance Act, 2008.

5 Word added by Finance Act, 2023 6 New clause added by Finance Act, 2023

7 Substituted “fifty” vide Finance Act, 2006.

The Federal Excise Act, 2005

(3) The Board may, by notification in the official Gazette, in lieu of levying and collecting under sub -section (1) duties of excis e on goods and services, as the case may be, levy and collect duties,—

(a) on the production capacity of plants, machinery, undertakings, establishments or installations producing or manufacturing such goods; or

(b) on fixed basis, as it may deem fit, o n any goods or class of goods or on any services or class of services, payable by any establishment or undertaking producing or manufacturing such goods or providing or rendering such services. 1[(3A) Subject to the provision of sub -section (3) of section 6 or any notification issued there under, where excisable goods and services are supplied to a person who has not obtained registration number, the Federal Government may, by notification in the official Gazette, charge, levy and collect, on the excisable goods and services specified in that notification, a further duty at the rate of two percent of the value in addition to the rate specified in sub-sections (1), (3), (4) and (5) of this section.]

(4) Without prejudice to other provisions of this Act, the 2[Federal Government] may levy and collect duty on any class or classes of goods or services by notification in the official Gazette at such higher or lower rate or rates as may be specified in such notification. 3[(5) The liability to pay duty shall be—

(a) in case of goods produced or manufactured in Pakistan, of the person manufacturing or producing such goods;

(b) in case of goods imported into Pakistan, of the person importing such goods;

1 Sub-section (3A) inserted by Finance Act, 2013. 2 Words “Federal Government” substituted by Finance Act, 2018. 3 Sub-section (5) inserted by Finance Act, 2013.

The Federal Excise Act, 2005

1[, provided where services are rendered by the person out of Pakistan, the recipient of such service in Pakistan shall be liable to pay duty; 2[omitted]

(d) in case of goods produce d or manufactured in non -tariff areas and brought to tariff areas for sale or consumption therein, of the person bringing or causing to bring such goods to tariff areas 3[; and

(e) in any other case, of the person including any middle man as may be spec ified under the provisions of this Act.] 4[(5A) In respect of goods, specified in the Fourth Schedule, the minimum production for a month shall be determined on the basis of a single or more inputs as consumed in the production process as per criterion specified in the Fourth Schedule and if minimum production so determined exceeds the actual supplies for the month, such minimum production shall be treated as quantity supplied during the month and the liability to pay duty shall be discharged accordingly.] Explanation.– Subject to sub -section (1), for the purpose of this section, “goods” means the goods specified in CHAPTERS 1 TO 97 and “services” means the services specified in CHAPTER 98 of the First Schedule to the Customs Act, 1969 (IV of 1969). 5[3A***]

Section 4. Filing of return and payment of duty etc

6[(1) 7[For every month, a registered person ] 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.]

1 Words etc. inserted by Finance Act, 2008.

2     In clause (c), the word “and” occurring at the end is omitted by Finance Act,2025. 
3       In clause (d), for the full stop at the end, the expression “; and” is substituted and thereafter the new clause

(e)added by Finance Act,2025. 4 New sub-section (5A) inserted through Finance Act, 2019. 5 Section 3A omitted by Finance Act, 2011 providing that in case of imports, this shall be deemed to have been made on June 20, 2011. Earlier it was inserted by Finance Act, 2007. 6 Sub section (1) substituted by Finance Act, 2006.

7 Substituted vide Finance Act, 2007.

The Federal Excise Act, 2005

1[(2) Duty due for the dutiable supplies made or services rendered during a month shall be deposited by the registered person in the designated branch of the bank 2[by the date as prescribed in this respect]:

Provided that the Board may, by notif ication in the official Gazette, prescribe any other manner of depositing the duty.] 3[(3)***]. 4(4) A registered person may, subject to approval of the 5[Commissioner Inland Revenue] of Federal Excise having jurisdiction, file a revised return within 6[one hundred and twenty] days of the filing of return under sub-section (1), to correct any omission or wrong declaration made therein 4[:] 7[Provided that the approval under this sub -section shall not be required if revised return is filed within sixty da ys of filing of the original return and either the duty payable as per the revised return is more than the amount paid or the refund claimed therein is less than the amount as claimed, under the return sought to be revised.]

(5) The Board may, by notification in the official Gazette, require any person or class of persons for any goods or class of goods to furnish such summary or details of particulars pertaining to imports, purchases, utilization, consumption, production, sales or disposal of such goods during any month or months in such format and manner as may be specified and provisions of this subsection may be invoked mutatis mutandis in respect of services.

(6) The Board may by an order, specify the manner and procedure for filing of return for the purpose of this Act or rules made there under

1 Substituted vide Finance Act, 2007.

2 Expression substituted through Finance Act, 2016. 3 Sub-section (3) omitted through Finance Act, 2016.

4 Substituted vide Finance Act, 2006.

5 Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

6 Amended vide Finance Act, 2008.

7 For full stop a colon substituted and thereafter proviso inserted by Finance Act, 2021.

The Federal Excise Act, 2005

and for payment of duty by electronic means. The Board may specify the manner and procedure for the submission, receipt and transmission of any information for the purpose of this Act or rules made there under by electronic means.

(7) Every amount of duty due from any person on any other account shall also be deposited on the prescribed 1[return] in the bank branch designated and in the same manner as aforesaid. 2[(8) The Board may, by rules made under this Act, prescribe a composite return.]

Section 5. Zero rate of duty and drawback of duty etc

(1) Notwithstanding the provisions of section 3, the goods exported out of Pakistan or such goods as may be, by a notification in the official Gazette, specified by the Federal Government shall be charged to duty at the rate of zero per cent and adjustment of duty in terms of section 6 shall be admissible on such goods.

(2) The Board may, by notification in the official Gazette, grant drawback of duty paid on any goods used in the manufacture of any goods manufactured in and exported out of Pakistan, or shipped as provisions or stores for consumption on board a ship or aircraft proceeding to a destination outside Pakistan, at such rate or rates and subject to such conditions and limitations as may be specified in the notification. 3[(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 exportati on of goods or any specified goods or class of goods to any specified foreign port or territory.]

Section 6. Adjustment of duties of excise

(1) For the purpose of determining net liability of duty in respect of any goods, the duty already paid on goods specified in the First Schedule and used directly as input goods for the manufacture or production of such goods shall be deducted from the amount of duty calculated on such goods.

(2) Adjustment of duty of excise under sub -section (1) shall be

1 Substituted for “challan” by Finance Act, 2007.

2 Added vide Finance Act, 2008.

3 Added vide Finance Act, 2007.

The Federal Excise Act, 2005

admissible only if a person registered under this Act holds a valid proof to the effect that he has paid the price of goods purchased by him including the amount of duty and received the price of goods sold by him including the amount of duty through banking channels including online payment whether through credit card or otherwise. 1[(2A) From the date to be notified by the Board, adjustment of duty of excise under sub -section (1) shall be admissible only if the supplier of input goods and services has declared such supply in his return and he has paid amount of tax due as indicated in his return]. 2[(2AB) Notwithstanding anything contained in this Act or the rules made thereunder, the Board may, by notification in the official Gazette, may impose restrictions on wastage o f material on which input tax has been claimed in respect of the goods or class of goods.]

(3) Notwithstanding the provisions of sub -section (1), the Board may, by a notification in the official Gazette, disallow or restrict whole or part of the amount of or otherwise regulate the adjustment of duty in respect of any goods or class of goods.

Section 7. Application of the provisions of the Sales Tax Act, 1990

3[(1)] In case of goods specified in the Second Schedule or such services as may be specified by the Board through a notification in the official Gazette 4[the duty shall be payable in sales tax mode, whereby],—

(a) a registered person manufacturing or producing such goods or providing or rendering such services shall be entitled to deduct input tax paid during the tax period from the amount of duty of excise due from him on such goods or services in respect of that tax period;

(b) a registered person shall be entitled to deduct the amount of duty of excise paid or payable by him on such goods or services as are

1 New sub-section added through Finance Act, 2016. 2 New sub-section inserted by Finance Act, 2020. 3 Section 7 renumbered as sub-section (1) by Finance Act, 2008. 4 Words and commas inserted by Finance Act, 2007.

The Federal Excise Act, 2005

acquired by him during a tax period from the output tax due from him in respect of that tax period;

(c) a registered person supplying such goods or providing or rendering such services shall be entitled to deduct duty of excise paid or payable on such goods or services as are acquired by him during the tax period from the amount of duty of excise due from him on such goods manufactured or produced or services as are

provided or rendered by him during that period; and

(d) a person shall be entitled to deduct duty of excise paid or payable, on such goods or services as are acquired by him during a month, from the amount of duty of excise due from him on such goods manufactured or produced or services as are provided or rendered by him, during that month. Such services as a re provided or rendered by him, during that month. Explanation.— For the purposes of this section, the expressions “input tax”, “output tax” and “tax period” shall have the same meanings as are assigned to them in the Sales Tax Act, 1990 1[*** ]. 2[(2) The 3[Board, with the approval of the Federal Minister -in- charge,] may, by notification in the official Gazette, declare that any of the provisions of the Sales Tax Act,1990, relating to the levy of and exemption from sales tax, regi stration, book keeping and invoicing requirements, returns, offences and penalties, appeals and recovery of arrears shall, with such modifications and alterations as it may consider necessary or desirable to adapt them to the circumstances, be applicable in regard to like matters in respect of the duty leviable under this Act.]

[4] Section 8. Default surcharge

If a person does not pay the duty due or any part thereof within the prescribed time or receives a refund of duty or drawback or makes an adjustment which is not admissible to him, he shall, in addition to the duty due, pay default surcharge at the rate of 5[twelve percent per annum or KIBOR plus three percent per annum, whichever is higher], of the duty due, refund of duty or drawback. Explanation.—For the purpose of this section,–

1 Omitted vide Finance Act, 2007.

2 Inserted vide Finance Act, 2008.

3 The words “Federal Government” substituted through Finance Act, 2019.

4 Inserted vide Finance Act, 2008.

5 Words substituted by Finance Act, 2024.

The Federal Excise Act, 2005

(a) the period of default shall be reckoned from the date following the due date on which the duty was payable to the preceding day on which the duty is actually paid; and

(b) in case of inadmissible adjustment or refund of duty or drawback, the period of default shall be reckoned from the date of such adjustment or as the case may be, refund of duty or drawback is received.]

Section 9. Liability for payment of duty in the case of private companies or business ente rprises or in case of sale of business ownership

(1) Notwithstanding anything contained in any other law for the time being in force, where any private company or business enterprise is closed or discontinued or otherwise ceases to exist and any amount of duty chargeable on the company or business enterprise, whether before, or in the course of, or after its liquidation cannot be recovered from the company or business enterprise, every person who was a owner of, or partner in, or director of, the company or business enterprise shall, jointly and severally with such persons, be liable for the payment of such duty.

(2) In the case of sale or transfer of ownership of a business or part thereof involving any charge of duty to another person as an ongoing concern, the chargeable duty shall be paid by the person to whom such sale is made or ownership is transferred provided that if any amount of duty payable by such person remains unpaid, such unpaid amount of duty shall be the first charge on the assets of the business and shall be payable by the transferee of business:

Provided that no business enterprise or a part thereof shall be sold or transferred unless the outstanding duty is paid and a no objection certificate in this behalf from the 1[Commissioner] concerned is obtained.

(3) In case of termination of a business or part thereof involving any outstanding charge of duty, a person terminating such business or part thereof shall be required to account for and pay the outstanding charge of duty as if no such termination has taken place.

Section 10. Applicable value and rate of duty

The value and the rate of duty applicable to any goods or services shall be the value, retail price, tariff value and the rate of duty in force,–.

(a) in the case of goods, on the date on which the goods are

1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010.

The Federal Excise Act, 2005

1[supplies] for export or for home consumption;

(b) in the case of services, on the date on which the services are

provided or rendered; and

(c) in the case of goods produced or manufactured outside the areas to which this Act has been applied and brought to such areas for sale or consumption therein, the date on which the goods are brought to those areas.

Section 11. Collection of excess duty etc

Every person who for any reason whatever has collected or collects any duty, which is not payable as duty or which is in excess of the duty actually payable and the incidence of which has been passed on to the consumer, shall pay the amount so collected to the Federal Government and all the provisions of this Act or rules made there under shall apply for the recovery of such amount and claim for refund of any such amount paid or recovered shall not be admissible on any ground whatever.

Section 12. Determination of value for the purposes of duty

2[(1) Where any goods are liable to duty under this Act a t a rate dependent on their value, duty shall be assessed and paid on the basis of value as determined in accordance with sub -section (46)of section 2 of the Sales Tax Act, 1990, excluding the amount of duty payable thereon. ]

(2) Where any services are l iable to duty under this Act at a rate dependent on the charges therefore, the duty shall be paid on total amount of charges for the services including the ancillary facilities or utilities, if any, irrespective whether such services have been rendered or provided on payment of charge or free of charge or on any concessional basis.

(3) Where any goods are chargeable to duty at the import stage, duty will be assessed and paid on the value determined in accordance with section 25 of the Customs Act, 1969 (IV of 1969), including customs duties payable thereon.

(4) Where any goods are chargeable to a duty on the basis of retail price, duty thereon shall be paid on the retail price fixed by the manufacturer, inclusive of all 3[duties,] charges and taxes, other than sales tax levied and

1 Substituted for “cleared” by Finance Act, 2007.

2 Substituted vide Finance Act, 2008 3 Words and comma inserted by Finance Act, 2007.

The Federal Excise Act, 2005

collected under section 3 of the Sales Tax Act, 1990, at which any particular brand or variety of such goods should be sold to the general body of consumers or, if more than one such price is so fixed for the same brand or variety, the highest of such price and such retail price shall, unless otherwise directed by the Board, be legibly, prominently and indelibly indicated on each good, packet, container, package, cover or label of such goods:

Provided that where so and as specified by the Board, any goods or class of goods liable to duty on local production as percentage of retail price, the provisions of this sub-section shall mutatis mutandis apply in case such goods are imported from abroad 1[:] 2[Provided further that the Board may through a general order specify zones or areas only for the purpose of determination of highest retail price for any brand or variety of goods.]

(5) The Board may fix the minimum price of any goods or class of goods, for the purpose of levying and co llecting of duty and duty on such goods shall be paid accordingly. 3[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 levi ed and collected at such higher price.]

Section 13. Registration

(1) Any person engaged in the production or manufacture of goods or providing or rendering services liable to duty of excise under this Act shall, unless otherwise specified, be required to obtain registration in the prescribed manner regardless of his annual turnover or volume of sales of such goods or services.

(2) Where a person who is already registered under the Sales Tax Act, 1990, shall not be required to take separate registration for exci se purpose and his sales tax registration shall be deemed to be a registration for the purpose of this Act:

Provided that provisions of the Sales Tax Act, 1990, including those relating to exemption threshold shall not apply where a person obtains or is liable to obtain registration for the purposes of this Act but does not have or is

1 Colon substituted vide Finance Act, 2014. 2 Proviso inserted vide Finance Act, 2014.

3 Added vide Finance Act, 2006.

The Federal Excise Act, 2005

not liable to registration under the Sales Tax Act, 1990.

Section 14. Recovery of unpaid duty or of erroneously refunded duty or arrears of duty, etc

(1) Where any person has not levied or paid any duty or has short levied or short paid such duty or where any amount of duty has been refunded erroneously, such person shall be serviced with notice requiring him to show cause for payment of such duty provided that such notice shall be issued within 1[five] years from the relevant date.

(2) The 2[officer of Inland Revenue] , empowered in this behalf, shall after considering the objections of the person served with a notice to show cause under sub-section (1), determine the amount of duty payable by him and such person shall pay the amount so determined along with default surcharge and penalty as specified by such officer under the provisions of this Act 3[:] 4[Provided that an order under this section shall be made within one hundred and twenty days of issuance of show cause notice or within such extended period as the Commissioner may, for reasons to be recorded in writing, fix, provided that such extended period shall in no case exceed sixty days:

Provided further that any period during w hich the proceedings are adjourned on account of a stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the petitioner not exceeding thirty days shall be excluded from the computation of the periods specified in the first proviso.]

(3) Where any amount of duty levied and penalty imposed or any other amount payable under this Act is due from any person, such amount or sum shall be recovered in such manner as is prescribed under this Act or rules made there under. 5[(4) The provision of sub-section (2) shall mutatis mutandis apply

1 Substituted for three by Finance Act, 2011.

3 Substituted for full stop by Finance Act, 2011.

4 Proviso inserted by Finance Act, 2011. 5 New sub-section (4) inserted by Finance Act, 2021.

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regarding assistance in collection and recovery of duties in pursuance of a request from a foreign jurisdiction under a tax treaty, a multilateral convention, and inter -governmental agreement or similar agreement or mechanism as the case may be.]

(4) Notwithstanding anything contained under any other law for the time being in force, where any business or activity involving liability to charge, levy and pay duty under this Act is sold, discontinued or liquidated, the amount of unpaid or recoverable duty shall be the first charge on the assets of the business. Explanation.—For the purpose of this section, 1[refund includes drawback of duty and] the expression “relevant date” means the dat e on which the payment of duty was due under sub -section (3) and in case where any amount of duty has been erroneously refunded, the date of its refund.

[2] Section 14A. Short paid amounts recoverable

Notwithstanding the provisions of this Act or the rules made there under , here a registered person pays the amount of duty less than the duty due as indicated in his return, the short paid amount of duty 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 prejudice to any other action under this Act or the rules made there under:

Provided that no penalty under this Act or rules made there under shall be imposed unless a show cause notice is given to such person.]

[3] Section 14B. Assessment giving effect to an order

. (1) Except where sub-section (2) applies, where, in consequence of, or to give effect to, any finding or direction in any order made under Chapter -V by the Commissioner (Appeals), Appellate Tribunal, High Court, or Supreme Court, the Commissioner or an officer of Inland Revenue empowered in this behalf, shall issue the order within one year from the end of the financial year in which the order of the Commissioner (Appeals), Appellate Tribunal, High Court or Supreme Court, as the case may be,

1 Added vide Finance Act, 2008.

2 Inserted by Finance Act, 2007.

3 New section 14B inserted by Finance Act, 2018.

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was served on the Commissioner or Officer of Inland Revenue.

(2) Where, by an order made under Chapter V by the Appellate Tribunal, High Court, or Supreme Court, an order of assessment is remanded wholly or partly, and the Commissioner or Commissioner

(Appeals) or the Officer of Inland Revenue, as the case may be, is directed to pass a new order of assessment, the Commissioner or Commissioner

(Appeals) or Officer of Inland Revenue, as the case m ay be, shall pass the new order within one year from the end of the financial year in which the Commissioner or Commissioner (Appeals) or Officer of Inland Revenue, as the case may be, is served with the order:

Provided that limitation under this sub -section shall not apply if an appeal or reference has been preferred against the order passed by Appellate Tribunal or a High Court.]

[1] Section 14C. Power of tax authorities to modify orders, etc

. (1) Where a question of law has been decided by a High Court or the Appellate Tribunal in the case of a registered person, on or after first day of July 2005, the Commissioner or an officer of Inland Revenue may, notwithstanding that he has preferred an appeal against the decision of the High Court or made an application fo r reference against the order of the Appellate Tribunal, as the case may be, follow the said decision in the case of the said taxpayer in so far as it applies to said question of law arising in any assessment pending before the Commissioner or an officer of Inland Revenue, until the decision of the High Court or of the Appellate Tribunal is reversed or modified.

(2) In case the decision of High Court or the Appellate Tribunal, referred to in sub -section (1), is reversed or modified, the Commissioner or an officer of Inland Revenue may, notwithstanding the expiry of period of limitation prescribed for making any assessment or order, within a period of one year from the date of receipt of decision, modify the assessment or order in which the said decision wa s applied so that it conforms to the final decision.]

Section 15. Application of the Customs Act, 1969 (IV of 1969) to Federal excise duties

The Federal Government may, by notification in the official Gazette, declare that any or all of the provisions of the Customs

1 New section 14C inserted by Finance Act, 2020.

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Act, 1969 (IV of 1969), shall, with such modifications and alterations it may specify, consider necessary or desirable to adapt them to the circumstances, be applicable in regard to like matters in respect of the duties levied by sections 3 and 8.

Section 16. Exemptions

(1) All goods imported, produced or manufactured in Pakistan and services provided or rendered except such goods and services as are specified in the First Schedule shall be exempt from whole of excise duties 1[levied under section 3]:

Provided that goods and services specified in the Third Schedule shall be exempt from duty subject to such conditions and restrictions, if any, specified therein and no adjustment in terms of section 6 shall be admissible in respect of goods exempt from duty of excise whether conditionally or otherwise.

2[(2) The Federal Government may, whenever circumstances exist to take immediate action for the purposes of national security, natural disaster, national food security in emergency situations and implementation of bilateral and multilateral agreements, by notification in the official Gazette, exempt subject to such conditions as may be specified therein, any goods or class of goods or any services or class of services from the whole or any part of the duty leviable under this Act.] 3[(3) * * *]

(4) Notwithstanding the provisions of 4[sub-section (2) ], the Federal Government or the Board may, by a notification in the official Gazette, for reasons to be recorded, exempt any person or class of persons from payment of the whole or part of the default surcharge imposed under section 8 5[and penalties] subject to the such conditions or limitations as may be specified in such notification. 6[(5) The 7[Board] shall place before the National Assembly all notifications issued under this section in a financial year.

1 Added vide Finance Act, 2007.

2 Sub-section (2) substituted by Finance Act, 2019. 3 Sub-section (3) omitted by Finance Act, 2015

4 Substituted for the words, figures and brackets “sub-sections (2) and (3)” by Finance Act, 2015

5 Inserted vide Finance Act, 2007.

6 Sub-sections (5) and (6) inserted by Finance Act, 2015

7 Substituted for the words “Federal Government” by Finance Act, 2017

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(6) Any notification issued under sub -section (2) after 1 st July, 2015, shall, if not earlier rescinded, stand rescinded on the expiry of the financial year in which it was issued 1[:

Provided that all such not ifications, except those earlier rescinded, shall be deemed to have been in force with effect from the 1 st July, 2016 and shall continue to be in force till the 30 th June, 2018, if not earlier rescinded:

Provided further that all notifications issued on or after the first day of July, 2016 and placed before the National Assembly as required under sub-section (5) shall continue to be in force till thirtieth day of June, 2018, if not earlier rescinded by the Federal Government or the National Assembly.]

Section 17. Records

(1) Every person registered for the purposes of this Act shall maintain and keep for a period of 2[six] years 3[or till such further period the final decision in any proceedings including proceedings for assessment, appeal, revision, reference, pe tition and any, proceedings before an Alternative Dispute Resolution Committee is finalized] at his business premises or registered office in English or Urdu language the following records of excisable goods purchased, manufactured and cleared (including those cleared without payment of excise duty) by him or by his agent acting on his behalf in such form and manner as would permit ready ascertainment of his liability of duty, namely:—

(a) records of clearances and sales made indicating the description, quantity and value of goods, name and address of the person to whom sales were made and the amount of the duty charged;

1 Provisos added by Finance Act, 2017

2 Substituted for “Five” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

3 Words and commas inserted by Finance Act, 2010 w.e.f. June 5, 2010. The same amend ment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed o n 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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(b) records of goods purchased showing the description, quantity and value of goods, name, address and registration number of the supplier and the amount of the duty, if any, on purchases;

(d) records of invoices, bills, accounts, agreements, contracts, orders and other allied business matters; 1[(da) record relating to gate passes, inward or outward, and transport receipts;]

(e) records of production, stocks and inventory;

(f) records of imports and exports; and

(g) such other records as may be specified by the Board.

(2) For any person or class of persons registered under this Act, or for any goods or class of goods the Board may specify or prescribe,—

(a) to keep any other records for the purposes of this Act;

(b) to use such electronic fiscal cash registers as may be approved by the Board; and

(c) the procedure or software for electronic maintenance of records and filing of statements, documents or information by any person or class of persons.

(3) Provisions of sub -sections (1) and (2) shall apply mutatis mutandis on services provided or rendered by a person registered under this

Act.

Section 18. Invoices

(1) A person registered under this Act shall issue for each transaction a serially numbered invoice at the time of clearance or sale of goods, including goods chargeable to duty at the rate of zero per cent, or providing or rendering services containing the following particulars, namely:–

1 Clause (da) inserted by Finance Act, 2013.

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a. name, address and registration number of the seller;

b. name, address and registration number of the buyer;

c. date of issue of the invoice;

d. description and quantity of goods or as the case may be, description of services;

e. value exclusive of excise duty;

f. amount of excise duty; and

g. value inclusive of excise duty.

(2) Notwithstanding sub-section (1), where a registered person is also engaged in making supplies taxable under the Sales Tax Act, 1990, such person shall not be required to issue a separate invoice for excise purposes and the amount of excise duty and other related information may in such cases be mentioned on the invoice issued for sales tax purposes.

(3) The Board may, by notification in the official Gazette, specify such modified invoices for different persons or classes of persons as it may deem necessary.

(4) The Board may, by notification in the official Gazette, specify goods in respect of which a cop y of the invoice shall be carried or accompanied with the conveyance during their transportation or movement in such manner and subject to such conditions as may be specified in this behalf either in such notification or otherwise. 1[(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.]

1 Added vide Finance Act, 2006

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CHAPTER III

OFFENCES AND PENALTIES

Section 19. Offences, penalties, fines and al lied matters

(1) Any person who fails to file or files an incorrect return within the period specified in sub-section (1) of section 4 or fails to make payment or makes short payment of duty on any account, shall pay a penalty of 1[five thousand rupees in case of non -filing of return and ten thousand rupees or five per cent of the du ty involved whichever is higher in case of short payment of duty due] in addition to the amount due from him and without prejudice to other liabilities which may be determined against him or action which may be taken against him under this Act and rules made there under ; 2[Provided that where a person files the return within fifteen days after the due date he shall pay a penalty of one hundred rupees for each day of default”; and]

(2) Any person who,––

(a) makes, orally or in writing, or signs any declaration, certificate or other document required by this Act or rules made there under or by any Federal Excise officer to do so, which is untrue or incorrect in any particular or which is incomplete by omitting any material particular there from;

(b) counterfeits or falsifies, or uses, when counterfeited or falsified, any document which is or may be required under this Act or rules made there under or any document used in the transaction of any business or matter relevant to this Act or rules made there under; 3[omitted]

1 Substituted vide Finance Act, 2008.

2 Added vide Finance Act, 2008.

3 The word “and” omitted by Finance Act, 2019.

4 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance

(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. Th is Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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Inland Revenue] any information or document required to be given or produced under this Act or rules made there under; 1[and] 2[(d) a person who sells cigarettes in retail at a price lower than the retail price plus the amount of sales tax as printed thereon,] shall be guilty of an offence and for every such offence shall be liable to fine which may extend to twenty thousand rupees and in case of offence under clause (b), the fine may extend to one hundred thousand rupees and he shall be punishable with imprisonment for a term which may extend to five years or with both.

(3) Any person who,—

(a) illegally removes, stores, keeps, or withdraws or in any way assists or is concerned in the illegal removal or withdrawal of any goods in the manner other than the manner prescribed under this Act or rules made there under;

(b) is in any way concerned in conveying, removing, depositing or dealing with any goods with intent to defraud the Government of any duty of excise due thereon, or to violate any of the provisions of this Act or rules made there under;

(d) claims, takes or avails adjustment of duty not admissible under this Act or the rules made there under; 3[***]

(e) is in any way concerned in the manufacture of any dutiable goods in contraven tion of the provisions of this Act or rules made there under; 4[and]

1 The word “and” inserted by Finance Act, 2019. 2 New clause (d) inserted through Finance Act, 2019.

3    Word and omitted by Finance Act, 2024. 
4    Word and inserted by Finance Act, 2024.

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1[(f) where the value of the plant and machinery is rupees fifty million and above, installs such plant and machinery, commences production or removes such plant and machinery without prior permission of the Commissioner; shall be guilty of an offence and for each such offence, shall be liable to fine which may extend to fifty thousand rupees or five times of the duty involved, whichever is higher and to punishment with imprisonment which may extend to five years or both.

(4) Any person who, without the approval of the 2[Commissioner], directly or otherwise destroys, damages, erases or otherwise manipulates data stored in or used in connection with a computer or otherwise uses a computer, the purpose or effect of which is to reduce, avoid or evade any liability to duty of excise which would otherwise have been imposed by this Act, or to defeat any provisions of this Act or rules made there under shall be guilty of an offence and shall be liable to fine which may extend to seventy five thousand rupees or ten times of the duty involved, whichever is higher and to punishment with imprisonment which may extend to five years or

both.

(5) If any person obtains, attempts to obtain or abets in obtainin g, or does anything whereby there might be obtained by another person, any amount by way of refund or drawback of any duty in respect of any goods 3[or services] not lawfully payable or allowable in respect thereof or which is greater than the amount so payable or allowable, he shall be guilty of an offence and shall be liable to fine which may extend to one hundred thousand rupees or five times of duty involved, whichever is higher and to punishment with imprisonment which may extend to five years or both.

(6) Any person who obstructs any 4[officer of Inland Revenue] or

1 New clause (f) inserted by Finance Act, 2024.

Originally this amendment was made through Finance (Amendmen t) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 3 Words inserted by Finance Act, 2008.

4 Substituted for “Federal Excise Officer” by Finan ce Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance

(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordina nce was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

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other public servant or any person acting in his aid or assistance, or duly employed for the prevention of offences under this Act or rules made there under in the execution of his duty or in the due seizing of any goods liable to seizure under this Act or rules made there under, shall be guilty of an offence and for each such offence, shall be liable to fine which may extend to fifty thousand rupees or five times of duty involved, whichever is higher and to punishment which may extend to three years or both.

(7) Where an offence under this Act or rules made there under has been committed by a company, firm, or other body of persons, any person who at the time of the commission of the offence was a di rector, manager, or other similar officer or a partner of the company, firm, or other body of persons or was purporting to act in that capacity shall be deemed to be guilty of that offence unless he proves that the offence was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised, having regard to the nature of his functions in that capacity and to all the circumstances.

(8) Unless otherwise legally proved, whe re any person is liable under this Act to any penalty or punishment for any act, omission, neglect or default, he shall be liable to the same punishment, penalty or forfeiture for every such act, omission, neglect or default of any agent or employee.

(9) Where any goods are chargeable to duty on the basis of retail price under this Act and the retail price is not indicated on the goods 1[and in case of cigarettes, retail price, health warning and name of the manufacturer is not mentioned ] in the manner specified therein or in the rules made there under, the duty shall be charged at the rate of 500 per cent ad valorem in case of cigarettes, and 40 per cent ad valorem in case of goods other than cigarettes:

Provided that in cases where a registered person doe s not intend to print retail price for any genuine reasons, he may voluntarily pay duty on the said higher rates as applicable to him and declare his duty payments in the return accordingly and other provisions of this section shall not apply in such

cases.

1 Added vide Finance Act, 2009.

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(10) 1[Where any person is engaged in the manufacture or production of cigarettes 2[or un-manufactured tobacco] in the manner contrary to this Act or the rules made thereunder or otherwise evades duty of excise on cigarettes 3[or un-manufactured tobacco] or is engaged in the manufacture or production of counterfeited cigarettes or tax stamps, banderoles, stickers, labels or barcodes, or is engaged in the manufacturing or production of cigarettes packs without affixing, or affixing counterfeited, tax stamps, banderoles, stickers, labels or barcodes, the machinery, equipments, instruments or devices used in such manufacture or production shall, after outright confiscation, be destroyed in such manner as may be approved by the Commissioner and such person shall not be entitled to any claim on any ground whatsoever, or be otherwise not entitled to any compensation in respect of such machinery or equipments, instruments or devices and such confiscation or destruction shall be without prejudice to any other penal action which may be taken under the law against the person or in respect of the cigarettes 1[or un-manufactured tobacco], tax stamps, stickers, labels, barcodes or vehicles involved in or otherwise linked or connected with the case.]

4[(10A) If any retailer is found selling cigarettes packs without affixing, or affixing counterfeited, tax stamps, banderoles, stickers, labels or barcodes, notwithstanding any other provision of this Act, the retail outlet of such person shall be liable to be sealed in the manner as may be prescribed.]

(11) Any goods in respect of which any of the provisions of this Act or rules made or notifications issued there under has been contravened shall be liable to confiscation along with the conveyance, if any, in which such goods are laden or have been or being carried and all confiscations in this regard shall vest with the Federal Government.

(12) Any person who attempts to commit any offence punishable under this Act, or abets the commission of the offence, shall be liable to the punishment provided for the offence.

(13) 5[Any person who contravenes any provision of this Act or rules made thereunder for which no penalty has specifically been provided

1 Sub-section (10) substituted by Finance Act, 2017 2 Words inserted by Finance Supplementary (Amendment) Act, 2018 3 Words inserted by Finance Supplementary (Amendment) Act, 2018 4 New sub-section (10A) inserted through Finance Act, 2024. 5 New sub-section (13) inserted through Finance Act, 2016.

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in this section shall be liable to pay a penalty of five thousand rupees or three percent of the amount of duty involved, whichever is higher].

1[19A. ***]

Section 20. Appointment of Special Judges for trial of offences

(1) The Federal Government may, by notification in the official Gazette, appoint as many Special Judges as it may consider necessary, and, where it appoints more than one Special Judge, shall specify in the notification the territorial limits within which each one of them shall exercise jurisdiction.

(2) A Special Judge shall be a person who is or has been or is qualified to be a Sessions Judge.

Section 21. Trial of offences by Special Judge

(1) On the appointment of a Special Judge for any area, an offence punishable under this Act shall be tried exclusively by the Special Judge and all cases pending in any other court in such area immediate ly before such appointment shall stand transferred to such Special Judge.

(2) The provisions of the Code of Criminal Procedure, 1898 (Act V of 1898), except those of Chapter XXXVIII of that Code, shall apply to the proceedings of the court of a Special Judge and, for the purposes of the said provisions, the court of a Special Judge shall be deemed to be a Court of Session trying cases, and a person conducting prosecution before the court of a Special Judge shall be deemed to be a Public Prosecutor.

(3) For the purposes of sub -section (2), the Code of Criminal Procedure, 1898 (Act V of 1898), shall have effect as if an offence punishable under this Act were one of the offences referred to in sub - section (1) of section 337 of the Code.

(4) A Special Judge shall take cognizance of, and have jurisdiction to try an offence tribal under sub -section (1) only upon a complaint in writing made by such 2[officer of Inland Revenue] as may be authorized by

1 Section 19A omitted through Finance Act, 2022.

2 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance

(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pa kistan Extraordinary Part I at pages 23 to 53. This Ordinance was pres ented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

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the Board in this behalf, by a general or special order in writing.

(5) The provisions of Chapter XX of the Code of Criminal Procedure, 1898 (Act V of 1898), shall apply to trial of cases under this Act in so far as they are not inconsistent with the provisions of this Act.

(6) The Federal Government may, by order in writing, direct the transfer, at any stage of the trial, of any case from the court of one Special Judge to the court of another Special Judge for disposal, whenever it appears to the Federal Government that such transfer will promote the ends of justice or tend to the general convenience of parties or witnesses.

(7) In respect of a case transferred to a Special Judge by virtue of sub-section (1) or under sub-section (6), such Judge shall not, by reason of the said transfer, be bound to recall and reh ear any witness who has given evidence in the case before the transfer and may act on the evidence already recorded by or produced before the court which tried the case before the transfer.

[1] Section 21A. Appeal against the order of Special Judge

An appeal against the order of a special Judge in respect of the trial of offence s hall lie to the respective High Court of the Province within thirty days of the passing of the order and it shall be heard as an appeal under the Code of Criminal Procedure 1898 (Act V of 1898) by a single judge of High Court.]

Section 22. Power to arrest and prosecute

(1) Any 2[officer of Inland Revenue] authorized by the Board in this behalf who has reason to believe that any person has committed an offence under this Act may arrest such person after obtaining permission in writing from the 3[Commissioner]

1 Section 21A inserted by Finance Act, 2010 w.e.f. June 5, 2010.

2 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not a pprove it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

3 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 2 3 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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concerned:

Provided that the 1[officer of Inland Revenue] shall immediately intimate the fact of the arrest of a person to the Special Judge who may direct such Officer to produce that perso n at such time and place and on such date as the Special Judge considers expedient and such Officer shall act accordingly.

(2) Notwithstanding anything contained in proviso to sub -section (1), any person arrested under this Act shall be produced before the Special Judge or, if there is no Special Judge within a reasonable distance, to the nearest Judicial Magistrate, within twenty -four hours of such arrest, excluding the time necessary for the journey from the place of arrest to the Court of the Special Judge or, as the case may be, of such Magistrate.

(3) When any person is produced under sub-section (2) before the Special Judge, he may, on the request of such person, after perusing the record, if any, and after giving the prosecution an opportunity of be ing heard, admit him to bail on his executing a bond, with or without sureties, or refuse to admit him to bail and direct his detention at such place as he deems fit:

Provided that nothing herein contained shall preclude the Special Judge from canceling the bail of any such person at a subsequent stage if, for any reason, he considers such cancellation necessary, but before passing such order he shall afford such person an opportunity of being heard, unless for reasons to be recorded he considers that the a ffording of such opportunity shall defeat the purposes of this Act.

(4) When such person is produced under sub -section (2) before a Judicial Magistrate, such Magistrate may, after authorizing his detention in such custody, at such place and for such perio d as he considers necessary or proper for facilitating his earliest production before the Special Judge, direct his production before the Special Judge on a date and time to be fixed by him or direct such person to be forthwith taken to, and produced before, the Special Judge and he shall be so taken.

(5) Nothing in sub -section (3) or sub -section (4) shall preclude

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the Special Judge or the Magistrate from remanding any such person to the custody of the 1[officer of Inland Revenue] holding inquiry against t hat person if such Officer makes a request in writing, to that effect and the Special Judge or the Judicial Magistrate, after perusing the record, if any, and hearing such person, is of the opinion that for the completion of inquiry or investigation it is necessary to make such an order, provided that in no case the period of such custody shall exceed fourteen days.

(6) When any person is arrested under this Act, the 1[officer of Inland Revenue] shall record the fact of arrest and other relevant particulars in the register mentioned in sub-section (10) and shall immediately proceed to inquire into the charge against such person and if he completes the inquiry within twenty-four hours of his arrest, excluding the time necessary for journey as aforesaid, h e may, after producing such person before the Special Judge or the nearest Judicial Magistrate make a request for his further detention in his custody.

(7) While holding an inquiry under sub-section (6), the 1[officer of Inland Revenue] shall exercise th e same powers as are exercisable by an officer in charge of a police-station under the Code of Criminal Procedure, 1898 (Act V of 1898), but such Officer shall exercise such powers subject to the foregoing provisions of this section while holding an inquir y under this Act.

(8) If a 1[officer of Inland Revenue], after holding an inquiry, is of the opinion that there is no sufficient evidence or reasonable grounds to proceed against a person he shall make a report to this effect to the 2[Commissioner] and with his approval may release him on his executing a bond with or without sureties and shall direct such person to appear, as and

1 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as O rdinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

2 Substituted for “Collector” by Finance Act, 2010 w .e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

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when required, before the Special Judge and may make a report to the Special Judge for the discharge of such person and shall make a full report of the case of his immediate superior.

(9) The Special Judge to whom a report has been made under subsection (8) may, after the perusal of record of the inquiry and hearing the prosecution, agree with such report and discharge the accused or, if he is of the opinion that there is sufficient ground for proceeding against such person, proceed with his trial and direct the prosecution to produce evidence.

(10) The 1[officer of Inland Revenue] empowered to hold inquiry under this section shall maintain a register to be called "Register of Arrests and Detention" in the prescribed form in which he shall enter the name and other particulars of every person arrested under this Act, together with the time and date of arrest, the details of the information received, the details of things, goods or documents, recovered from his custody, the name of the witnesses and the explanation, if any, given by him and the manner in which the inquiry has been conducted from day to day, and such register or authenticated copies of its aforesaid entries shall be produced before the Special Judge whenever such Officer is so directed by him.

(11) After completing the inquiry, the 1[officer of Inland Revenue] shall, as early as possible, submit to the Special J udge a complaint in the same form and manner, in which the officer in charge of a police -station submits a report before a court.

(12) Any Magistrate of the first class may record any statement or confession during inquiry under this Act, in accordance wi th the provisions of section 164 of the Code of Criminal Procedure, 1898 (Act V of 1898).

(13) Without prejudice to the foregoing provisions of this section, the 2[Board, with the approval of the Federal Minister -in-charge,] may, by

1 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

Originally this amendment was made through Finance (Amend ment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 2 The words “Federal Government” substituted through Finance Act, 2019.

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notification in the of ficial Gazette, authorize any other officer working under the Board to exercise the powers and perform the functions of a 1[officer of Inland Revenue] under this section, subject to such conditions, if any, that it may deem fit to impose.

(14) Notwithstanding any provision of this Act, where any person has committed an offence liable to penalty or punishment under this Act, the 1[Commissioner] may, either before or after the initiation of any proceedings for the recovery of duty or prosecution of such pers on, compound the offence if he pays the amount of duty along with such default surcharge and penalty as is determined under the provisions of this Act.

Section 23. Power to summon persons to give evidence and produce documents in inquiries

(1) Any 2[officer of Inland Revenue] duly empowered by the Board in this behalf shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing or information in any inquiry which such officer is making for any of the purposes of this Act.

(2) All persons so summoned shall be bound to attend, either in person or by an authorized agent, as such Officer may direct, and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and to produce such documents and other things as may be required:

Provided that the exemptions under sections 132 and 133 of the Code of Civil Procedure (V of 1908) shall be applicable to requisitions for attendance under this section.

(3) Every such inquiry as aforesaid shall be deemed to be a

1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

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"judicial proceeding" within the meaning of section 193 and section 228 of the Pakistan Penal Code (XLV of 1860).

Section 24. Officers required to assist 1[officer of Inlan d Revenue]

All officers of Police and Customs, sales tax, the civil armed forces and all officers of Government engaged in the collection of land -revenue, and all village officers shall assist the 1[officer of Inland Revenue] in the execution of this Act as and when required by such Officers.

The Federal Excise Act, 2005

CHAPTER IV

SEARCHES, ARRESTS AND SEIZURES

Section 25. Searches and arrests how to be made

All searches or arrests made under this Act or any rules made there under and all arrests made under this Act shall be carried out in accordance with the relevant provisions of the Code of Criminal Procedure, 1898 (V of 1898).

Section 26. Power to seize

1[(1) The counterfeited cigarettes or beverages whi ch have been manufactured or produced unlawfully and other dutiable goods on which duty of excise h as not been paid in the manner as required under this Act and the rules made thereunder 2[or such goods without affixing or affixing counterfeit tax stamps, bar codes, banderoles, stickers, labels or bar codes, as required under section 4 5A of this Act], shall be liable to seizure along with the conveyance, which has been used for the movement, carriage or transportation of such goods.

(2) For the purpose of this section, ‘conveyance’ shall include all of its fixtures, fittings and accessories etc.]

Section 27. Confiscation 3[of goods subject to federal excise duty]

(1) The cigarettes 1[or beverages] seized for the reasons of counterfeiting 4[or such goods without affixing or affixing counterfeited tax stamps, banderoles, stickers, labels or b arcodes, as required under section 45A of this Act] shall be liable to outright confiscation and shall be destroyed in the manner prescribed in sub-section (10) of section 19.

(2) In case of 5[dutiable goods ] seized on account of evasion of duty, the owne r shall be given an option to pay penalties and fines as

provided under section 19 and meet other obligations as provided under other relevant provisions of the Act and rules made there under, for release

1 Sub-section (1) substituted by Finance Act, 2020. 2 In section 26, in sub-section (1), after the word “thereunder”, the expression “or such goods without affixing or affixing counterfeit tax stamps, bar codes, banderoles, stickers, labels or bar codes, as required under section 45A of this Act inserted by Finance Act, 2025. 3 Marginal note expression substituted by Finance Act, 2020. 4 In section 2 7, in sub -section (1), after the word “counterfeiting”, the expression “or such goods without affixing or affixing counterfeit ed tax stamps, banderoles, stick ers, labels or bar codes, as required under section 45A of this Act inserted by Finance Act, 2025. 5 Expression substituted by Finance Act, 2020.

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of such 3[dutiable goods ] in lieu of confiscation provided that if such release is not claimed or availed, no reduction or abatement in respect of amounts of duty, penalties and fine shall be admissible in case such 3[dutiable goods] are auctioned.

(3) In case confiscated cigarettes 1[ , un-manufactured tobacco] are rendered unfit for human consumption or become otherwise unfit for sale, the 1[Commissioner] may allow destruction of such cigarettes 1[ , un- manufactured tobacco] in such manner as he may deem appropriate. 2[(4) Without prejudice to the foregoing provisions of this section, the Board in case of goods subject to monitoring under section 45A of this Act and counterfeited goods, may authorize any officer of Revenue department not below the rank of Naib Tehsildar or Excise and Taxation Officer not below the rank of BPS-16 to exercise the powers and perform the functions of the Officer of Inland Revenue under section 26 and sub-section (1) of section 27, by notification in the official Gazette subject to such conditions, if any, it may deem fit to be imposed.]

Section 28. Power to release seized conveyance

(1) Where any conveyance is seized which is liable to confiscation, the adjudicating authority may, subject to such conditions as may be prescribed, order its release pending adjudication of the case and on furnishing a guarantee by the owner of the seized conveyance, from a scheduled bank valid for at least one year equal to the value of such conveyance.

(2) In respect of cases pending before the Special Judge, release of conveyance under sub -section (1) shall not be allowed without prior permission of the Special Judge.

1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliam ent did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

2 Sub-section (4) inserted by Finance Act, 2025.

The Federal Excise Act, 2005

CHAPTER V

POWERS, ADJUDICATION AND APPEALS

Section 29. Appointment of Federal excise officers and delegation of powers

1[(1) For the purposes of this Act and rules made there under, the Board may, by notification in the official Gazette, appoint, in relation to any area or jurisdiction specified in the notification, any person to be –

(a) Chief Commissioner Inland Revenue;

(b) Commissioner Inland Revenue;

(d) Additional Commissioner Inland Revenue;

(e) Deputy Commissioner Inland Revenue; 2[(ea) District Taxation Officer Inland Revenue];

(f) Assistant Commissioner Inland Revenue; 2[(fa) Assistant Director Audit Inland Revenue];

(g) Inland Revenue Officer;

(h) Superintendent Inland Revenue;

(i) Inspector Inland Revenue;

(j) Inland revenue Audit Officer; and

(k) Officer of Inland Revenue with any other designation.]

3[(1A) The Chief Commissioner Inland Revenue and Commissioner Inland Revenue (Appeals) shall be subordinate to the Board and Commissioner Inland Revenue shall be subordinate to the Chief Commissioner Inland Revenue.

1 Sub-section (1) substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 2 Clauses (ea) & (fa) added by Finance Act, 2017 3 Section (1A), (1B) and (1C) inserted by Finance Act , 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance wa s presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Ga zette of Pakistan Extraordinary Part I at pages 229 to 259

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1[(1AA) The Chief Commissioners Inland Revenue shall perform their functions in respect of such persons or classes of persons or such areas as the Board may direct.

4(1AB) The Commissioners Inland Revenue shall perform their functions in respect of such persons or classes of persons or such areas as the Chief Commissioner, to whom they are sub-ordinate, may direct.]

(1B) Additional Commissioner Inland Revenue, Depu ty Commissioner Inland Revenue 2[, District Taxation Officer Inland Revenue], Assistant Commissioners Inland Revenue Officers 3[, Assistant Director Audit Inland Revenue], Inspector Inland Revenue and Officers of Inland Revenue with any other designation s hall be subordinate to the Commissioner Inland Revenue and shall perform their functions in respect of such persons or classes of persons or such areas as the Commissioners, to whom they are subordinate, may direct.

(1C) Deputy Commissioners Inland Reven ue 1[, District Taxation Officer Inland Revenue] , A ssistant Commissioners Inland Revenue 1[, Assistant Director Audit Inland Revenue], Inland R evenue Officers, Superintendents Inland Revenue, Inland Revenue Audit Officers, Inspectors Inland Revenue, and Officers of Inland Revenue with any other designation shall be subordinate top the Additional Commissioner Inland Revenue.]

(2) Notwithstanding the other designations of the officers of Federal Excise used in this Act or the rules made there under:

(a) the Directorate General (Intelligence & Investigation) 4[Inland Revenue] shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and other officers with any other designation as the Board may appoint by notification in the official Gazette;

5[(aa) The Board may, by notification in the official Gazette,–

1 Sub-sections (1AA) & (1AB) added by Finance Act, 2017 2 The expression inserted by Finance Act, 2017 3 The expressions inserted by Finance Act, 2017

4 Substituted vide Finance Act, 2007.

5 New clause “aa” added by Finance Act, 2018.

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(i) specify the functions and jurisdiction of the Directorate General and its officers; and

(ii) confer the powers of authorities specified i n 1[sub- section (1) of section 29] upon the Directorate General and its officers];

(b) the Directorate General 2[***] Internal Audit shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and other officers with any other designation as the Board may appoint by notification in the official Gazette; 3[***]

(c) the 4[Inland Revenue Services Academy] shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and other officers with any other designation as the Board may appoint by notification in the official Gazette5[; 6[***] 7[(d) the Directorate General of Digital Initiatives shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors and Assistant Directors and such other officers as the Board may, by notification in the official Gazette, appoint 8[: and] 9[(e) the Directorate -General of law shall consist of a Director General and as many Directors, Additional Directors, Deputy Directors, Assistant Directors, Law Officers and such other officers as the Board may, by notification in the official Gazette, appoint and the Board shall, specify therein functions, jurisdiction and powers of each such officer of the Directorate- General of law.]

1 Words substituted by Finance Supplementary (Second Amendment) Act, 2019

2 Omitted vide Finance Act, 2007.

3 Word omitted by Finance Act, 2023 4 Words substituted by Finance Act, 2022. 5 For full stop semi colon substituted and word “and” added by Finance Act, 2023 6 Word “and” omitted by Tax Laws (Amendment) Act, 2024. 7 New clause added by Finance Act, 2023 8 For the full stop, a colon and the word "and" substituted by Tax Laws (Amendment) Act, 2024. 9 New clause (e) added by Tax Laws (Amendment) Act, 2024.

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(3) 1[The Board or the Chief Commissioner with the approval of the Board, may], empower by name or designation,—

(a) any 2[Additional Commissioner Inland Revenue] or 3[Deputy Commissioner Inland Revenue] to exercise any of the powers of a 4[Commissioner Inland Revenue];

(b) any 4[Deputy Commissioner Inland Revenue] or 5[Assistant Commissioner Inland Revenue] to exercise any of the powers of an 6[Additional Commissioner Inland Revenue];

1 Words substituted by Finance Act, 2010.

2 Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No.

XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

3 Substituted for “Deputy Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinanc e was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No.

XXII of 2009, dated October 28, 2009, published in th e Gazette of Pakistan Extraordinary Part I at pages 229 to 259

4 Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III o f 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

5 Substituted for “Assistant Collector of Federal Excise” by Finance A ct, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 june 2010 as Parliament did not approve it.

6 Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Financ e (Amendment) Ordinance, 2009, promulgated as Ordinance No.

XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

7 Substituted for “Assistant Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of

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of the powers of a 1[Deputy Commissioner Inland Revenue]; and

(d) any other 2[officer of Inland Revenue] to exercise any of the powers of a 3[Commissioner Inland Revenue] , 1[Additional Commissioner Inland Revenue] , 3[Deputy Commissioner Inland Revenue] or 2[Assistant Commissioner Inland Revenue]; under this Act and the rules made there under. 4[ 4 *** ]

(5) The officer to whom any powers of any senior officer are delegated under this section shall not further delegate such powers.

[5] Section 29A. Tax Fraud Investigation Wing Inland Revenue

(1) There shall be established a wing to be known as Tax Fraud Investigation Wing Inland Revenue.

(2) The functions of the tax fraud Investigation Wing Inla nd

2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

1 Substituted for “Deputy Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No.

XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

2 Substituted for “Officer of Inland Revenue” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

3 Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, publ ished in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

Originally this amendment was made through Finance (Amendment) Ordinance, 20 09, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 4 Sub-section (4) omitted by Finance Act, 2010 w.e.f. June 5, 2010. 5 New section inserted by Finance Act, 2024.

The Federal Excise Act, 2005

Revenue shall be to detect, analyze, investigate, combat and prevent tax

fraud.

(3) The tax fraud Investigation Wing Inland Revenue shall comprise Fraud Intelligence and Analysis Unit, Fraud Investigation Unit, Legal Unit, Accountants Unit, Digital F orensic and Scene of Crime Unit, Administrative Unit or any other Unit as may be notified by the Board by notification in the official Gazette.

(4) The tax fraud Investigation Wing Inland Revenue shall consist of a Chief Investigator and as many followi ng officers, as may be notified by the Board, namely:–

(a) Senior Investigators, Investigators, Junior Investigators or any other officer of Inland Revenue with any other designation;

(b) a Senior Forensic Analyst and as many Forensic Analysts and Junior Forensic Analysts; and

(5) The Board may, by notification in the official Gazette,-

(a) specify the functions and jurisdiction of the Tax Fraud Investigation Wing Inland Revenue and its Units and officers; and

(b) confer the powers of authorities specified in section 29 upon the Tax Fraud Investigation Wing Inland Revenue and its officers under clause (a) of sub-section 4.

(6) Nothing contained in this section shall prevent the authorities appointed under section 29 or any other authority or officer conferred with the powers and functions of authorities appointed under section 29 from conducting investigation and prosecution under Chapter III of the Act.]

Section 30. Use of powers of subordinate officer

(1) An officer appointed under this Act shall exercise such powers and discharge such duties as are conferred or imposed on him under this Act an d he shall also be competent to exercise all powers and discharge all dut ies or functions

The Federal Excise Act, 2005

conferred or imposed upon any officer subordinate to him.

(2) Notwithstanding anything contained in this Act or the rules made there under, the Board may, by general or special order, impose such limitations or conditions on the exercise of such powers and discharge of such duties by any 1[officer of Inland Revenue]as it deems fit. 2[ 31***]

Section 32. Option to pay fine in lieu of confiscation of conveyance

Wherever confiscation is adjudged under this Act or the rules made there under, the officer adjudging it may give the owner of the conveyance an option to pay in lieu of confiscation such fine as the officer thinks fit.

Section 33. Appeals to 3[Commissioner] (Appeals)

4[(1)] Any person other than 5[an SOE or] Federal Excise officer aggrieved b y any decision or order 6[ ] passed under this Act or the rules made thereunder by a 1[officer of Inland Revenue up to the rank of 7[Additional Commissioner Inland Revenue] , other than a decision or order or notice given or action

1 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette o f Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 2 Section (31) omitted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance

(Amendment) Ordinance, 2 010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. O riginally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

3 Substituted for “Collector” b y Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 4 Numbered vide Finance Act, 2006.

5 Expression “an SOE or” inserted by Finance Act, 2025. 6 Expression omitted by Finance Act, 2025.

7 Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ord inance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No.

XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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taken for recovery of the arrears of duty under this Act or rules made there under may within thirty days of receipt of such decision or order prefer appeal there from to the 3[Commissioner] (Appeals). 1[(1A) where in a particular case, the Commissioner (Appeals) is of the opinio n that the recovery of tax levied under this Act, shall cause undue hardship to the taxpayer, he, after affording opportunity of being heard to the Commissioner or officer of Inland Revenue against whose order appeal has been made, may stay the recovery of such tax for a period not exceeding thirty days in aggregate.]

2[(1B) An appeal under sub-section (1) shall–

(a) be in the prescribed form;

(b) be verified in the prescribed manner;

(d) be accompanied by the prescribed fee specified in sub-section (1C); and

(e) be filed with the Commissioner (Appeals) within the time set out in sub-section (1).

(1C) The prescribed fee shall be–

(a) in the case of an appeal against an assessment–

(i) where the appellant is a company, five thousand rupees; or

(ii) where the appellant is not a company, two thousand and five hundred rupees; and

(b) in any other case–

(i) where appellant is a company, five thousand rupees; or

(ii) where the appellant is not a company, one thousand rupees.]

3[(2) The 4[Commissioner] (Appeals) may, after giving both parties

1 Sub section (1A) inserted vid Finance Act, 2013. 2 New sub-sections (1B) and (1C) inserted by Finance Act, 2020.

3 Added vide Finance Act, 2006.

4 Substituted for “Collector” by F inance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was

The Federal Excise Act, 2005

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 1[:] 2[Provided that such order shall be passed not later than [one hundred and twenty] days from the date of filing of appeal or within such extended period, not exceeding 3[sixty] days, as the 2[Commissioner]

(Appeals) may, for reasons to be recorded in writing, extend.] 4[Provided further that any period during which the proceeding are adjourned on account of stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the petitioner not exceeding thirty days shall be excluded for the computation of these period.]

(3) In deciding an appeal, the 2[Commissioner] (Appeals) may make such further inquiry as may be necessary provided that he shall not remand the case for de novo consideration.] 5[(4) The Commissioner (Appeals) shall not admit any documentary material or evidence which was not produced before the Officer Inland Revenue unless the Commissioner (Appeals) is satisfied that the appellant was prevented by sufficient cause from producing su ch material or evidence before the Officer Inland Revenue.] 6[(5) Registered person shall have an option to directly file an appeal before Appellate Tribunal Inland Revenue without availing right of appeal under this section.]

[7] Section 33A. Omitted

made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 1 Full stop substituted vide Finance Act, 2007.

2 Inserted vide Finance Act, 2007.

3 Substituted vide Finance Act, 2009.

4 Added vide Finance Act, 2009.

5     New sub-section (4) inserted by Finance Act, 2020. 
6     Sub-section (5) inserted by Finance Act, 2025. 
7     Section 33A omitted by Finance Act, 2025.

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Section 34. Appeals to the Appellate Tribunal 1[***]

2[(1) Any person, other than an SOE, aggrieved by any order passed by the Board or the Commissioner Inland Revenue under section 35 or an order passed by an Officer of Inland Revenue where sub -section (5) of section 33 applies or the Commissioner (Appeals) under this Act or the rules made thereunder may, within thirty days of the receipt of such order, prefer an appeal to the Appellate Tribunal:

Provided that where sub -section (11) of section 134A of the Income Tax Ordinance, 2001 (XLIX of 2001) shall apply, an SOE may prefer an appeal under this sub-section.] 3[(2)***] 4[(3) The Appellate Tribunal may admit, hear and dispose of the appeal as per procedure laid down in sections 131 and 132 of the Income Tax Ordinance, 2001 (XLIX of 2001), and rules made thereunder.]

[5] Section 34A. Reference to the High Court

6[(1) Within sixty days of the order of the Appellate Tribunal, the aggrieved person or the Commissioner may make a reference in the prescribed form along with a statement of the case and complete record of the Appellate Tribunal to the High Court, stating any question of law arising out of such order.]

(2) Provisions of section 133 of the Income Tax Ordinance, 2001 (XLIX of 2001) and rules made thereunder relating to a reference to the High Court shall, mutatis mut andis, apply to references to the High Court under this Act.]

[7] Section 34AB. Saving

The period of limitation provided in sub-section (1) of section 34 and sub -section (1) of section 34A shall continue t o apply where any decision of the Commissioner (Appeals) or the Appellate Tribunal is received prior to the date of commencement of the Tax Laws

(Amendment) Act, 2024 (V of 2024).]

1    Words “and Reference to High Court” omitted by Finance Act, 2011. 
2    Sub-section (1) of section 34 substituted by Finance Act, 2025.

3 Sub-section (2) omitted by Finance Act, 2010. 4 New sub-section (3) inserted by Finance Act, 2020. 5 Section 34A substituted by Tax Laws (Amendment) Act, 2024. 6 Sub-section (1) of section 34A substituted by Finance Act, 2025. 7 New section 34AB inserted by Finance Act, 2024.

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Section 35. Powers of Board or 1[Commissioner] to pass certain orders

(1) The Board or the 2[Commissioner] within his jurisdiction, may suo moto 2[, or otherwise ] call for and examine the records of any proceedings under this Act for the purpose of satisfying itself or, as the case may be, himself as to the legality or propriety of any decision or order passed by a subordinate officer and may pass such order as it or he may think fit.

(2) No order confiscating goods of greater value or enhancing any fine, or imposing or enhancing any penalty, or requiring payment of any duty not levied or short-levied shall be passed under sub -section (1) unless the person affected thereby has been given an opportunity of showing cause against it and of being heard in person or through a counsel or other person duly authorized by him.

(3) No record of any proceedings relating to any decision or order passed by any 3[officer of Inland Revenue] shall be called for or examined under subsection (1) after the expiry of two years from the date of such decision or order. 4[Explanation.– For the purpose of sections 35, 45 and 46 and for removal of doubt, it is declared that the powers of the Board, Commissioner or officer of Inland Revenue under these sections are independent of the powers of the Board under section 42B and nothing contained in section 42B restrict the powers of the Board, Commissioner or officer of Inland Revenue under these sections or to conduct audit under these sections.]

1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, pro mulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 2 Comma and words inserted by Finance Act, 2015.

Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 4 Explanation inserted by Finance Act, 2013. It aims at nullifying judgments of higher courts, see under section 42B.

The Federal Excise Act, 2005

Section 36. Power to rectify mistakes in orders

The Federal Government, the Board or any 1[officer of Inland Revenue] may rectify any mistake which is apparent from the record in any order passed by it or him under any of the provisions of this Act or the rules made there under, on its or his own motion or on an application made by a person affected by the order within three years of the passing of such order provided that no such rectification which has the effect of enhancing any penalty or fine or requiring the payment of a greater amount of duty shall be made unless the person affected by the proposed rectification has be en given an opportunity of being heard.

Section 37. Deposit, pending appeal, of duty demanded or penalty levied

(1) Where in any appeal, the decision or order appealed against relates to any duty demanded or penalty imposed under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposit the duty demanded or the penalty imposed provided that the Appellate Tribunal or 2[Commissioner] (Appeals) may in any particular case dispense with such deposit subject to such conditions as it may deem fit to impose so as to safeguard the interest of revenue.

(2) The order for such dispensation under sub-section (1) shall cease to have effect on the expiration of a period of six months following the date on which order for dispensation was passed or until the order of dispensation is withdrawn earlier or the case is finally decided earlier by the Appellate Tribunal or 1[Commissioner] (Appeals).

(3) Notwithstanding sub -sections (1) and (2), the Appellate Tribunal or 1[Commissioner] (Appeals) may direct that, pending decision

1 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010 . The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliam ent but lapsed on 5 June 2010 as Parliament did not approve it.

2 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulga ted as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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on the appeal, the duty demanded or penalty imposed, alongwith the default surcharge payable under this Act, be paid by the appellant in suitable installments spread over a period not exceeding six months from the date of such direction:

Provided that where a person has, at the time of filing appeal, deposited fifteen per cent of the liability covered under the decision or order appealed against, he shall not be required to separately seek stay against recovery and stay in such a case shall commence from the date of payment of such fifteen per cent amount and shall remain valid till the expiry of a period of six months or till the decision of the appeal, whichever is earlier unless the case is decided in his fa vour and the amount so paid is claimed to have become due for refund 1[:]

1[Provided further that the Commissioner Inland Revenue or any officer of Inland Revenue subordinate to him shall not issue notice under this section or recovery rules made under th e Federal Excise Rules, 2005 for recovery of any tax due from a taxpayer if the said taxpayer has filed an appeal under section 33 in respect of the order under which the tax sought to be recovered has become payable and the appeal has not been decided by the Commissioner (Appeals), subject to the condition that 2[ten] per cent of the said amount of tax due has been paid by the taxpayer.]

[3] Section 38. Alternative dispute resolution

(1) Notwithstanding any other provision of this Act, or the rules made thereunde r, an aggrieved person in connection with any dispute pertaining to-

(a) the liability of tax of' fifty million -rupees or above against the aggrieved person or admissibility of refund, as the case may be;

(b) the extent of waiver of default surcharge and penalty; or

may apply, except where criminal proceedings have been initiated, to the Board for the appointment of a committee for the resolution of any

1 Colon & new proviso added by Finance Act, 2017 2 Words “ten” substituted by Finance Act, 2018. 3 Section 38 substituted by Tax Laws (Amendment) Act, 2024.

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hardship or dispute mentioned in detail in the application:

Provided that where the aggrieved person is a state -owned enterprise (SOE), the li mit of tax liability of fifty million rupees or above mentioned in clause (a) of sub -section (1) shall not apply and it shall be mandatory for such aggrieved SOE to apply to the Board for the appointment of a committee for the resolution of any dispute under this section:

Provided further that no suit, prosecution, or other legal proceedings shall lie against the SOE in relation to the dispute resolved under this section.

Explanation.- State-owned enterprise shall have the same meaning as assigned thereto in the State -Owned Enterprises (Governance and Operations) Act, 2023 (VII of 2023).

(2) Provisions of section 134A of the Income Tax Ordinance, 2001 (XLIX of 2001) and rules made thereunder relating to alternative dispute resolution shall, mutatis mutandis, apply to a pplications for alternative dispute resolution under this Act.]

Section 39. Exclusion of time taken for copy

In computing the period of limitation specified for an appeal or application under this Chapter, the day on which the order complained was served, and if the party preferring the appeal or making the application was not furnished with a copy of the order when the notice of the order was served upon him, the time requisite for obtaining a copy of such order shall be excluded.

CHAPTER VI

SUPPLEMENTAL PROVISIONS

Section 40. Power of Board to make rules

(1) The Board may make rules to carry into effect the purposes of any or all the provisions of this Act including charging fee for processing of returns, claims and other documents and for preparation of copies thereof.

(2) In making rules under this section, the Board may provide that

The Federal Excise Act, 2005

any person committing a breach of any rule shall, without prejudice to any other action that may be taken against him under this Act, be liable to such penalty as may be prescribed under the rules and that any article in respect of which any such breach is committed shall be confiscated or destroyed.

(3) The Board may, i n respect of cigarettes, make rules or issue instructions for the purpose of affixing duty stamps and banderoles and any instructions issued in this behalf shall have the force of rules issued under this

Act. 1[(4) All rules made under sub -section (1) or any other provisions of this Act, shall be collected, arranged and published along with general orders and departmental instructions and rulings, if any, at appropriate intervals and sold to the public at reasonable price or may be placed regularly on the official website maintained by the Board.]

Section 41. Bar of suit and limitation of suit and other legal proceedings

(1) No suit shall be brought in any civil court to set aside or modify any order passed, or any assessment, levy or collection of any duty, under this Act.

(2) No suit prosecution or other legal proceeding shall lie against the Federal Government or against any officer of the Government in respect of any order passed in good faith or any act in good faith done or ordered to be done under this Act.

(3) Notwithstanding anything in any other law for the time being in force, no investigation or inquiry shall be undertaken or initiated by any governmental agency against any officer or official for anything done in his official capacity under this Act, rules, instructions or direction made or issued there under without the prior approval of the Board.

Section 42. Observance of Board's orders, directions and instructions

All officers and persons employed in the execution of this Act and the rules made there under shall observe and follow the orders, directions and instructions of the Board provided that no such order, direction or instruction shall be given by the Board so as to interfere with the discretion of an officer in deciding the issues o r matters brought before him for

1 New sub-section added by Finance Act, 2023.

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adjudication under this Act or rules made there under.

[1] Section 42A. Reference to authorities

Any reference to Collector, Additional Collector, Deputy Collector, Assistant Collector, Superintendent and an officer of federal exc ise, wherever occurring, in this Act and the rules Notifications, clarifications, general orders or orders made or issued there under, shall be construed as reference to Commissioner Inland Revenue, Additional Commissioner Inland Revenue, Deputy Commissioner Inland Revenue, Assistant Commissioner Inland Revenue, Superintendent Inland Revenue and an officer of inland Revenue, respectively.

[2] Section 42B. Selection for audit by the Board

(1) The Board may select persons or classes of persons for audit of records and documents through computer ballot which may be random or parametric as the Board may deem fit. 3[(1A) Notwithstanding anything contained in this Act or any other law, for the time being in force, the Board shall keep the parameters confidential.]

(2) Audit of such persons selected under sub -section (1) shall be conducted as per procedure given in section 46 and all the provisions of Act shall apply accordingly.

(3) For the removal of doubt, it is hereby declared that Board shall be deemed always to h ave had, the power to select any persons or classes of persons for audit.]

[4] Section 42C. Reward to Inland Revenue officers and officials

(1) In cases involving concealment or evasion of excise duty and other taxes, cash reward shall be sanctioned to the office rs and officials of Inland Revenue for their meritorious conduct in such cases and to the informer

1 Section 42A and 42B inserted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 2 Section 42B inserted by Finance Act, 2010. 3 New sub-section (1A) inserted by Finance Act, 2020. 4 Section 42C inserted by Finance Act, 2013.

The Federal Excise Act, 2005

providing credible information leading to such detection, as may be prescribed by the Board, only after realization of part or whole of the taxes involved in such cases.

(1) The Board may, by notification in the official Gazette, prescribe the procedure in this behalf and specify the apportionment of reward sanctioned under this section for individual performance or to collective welfare of the officers and officials of Inland Revenue.]

[1] Section 42D. Reward to whistleblowers

(1) The Boar d may sanction reward to whistleblowers in cases of concealment or evasion of duty, corruption or misconduct providing credible information leading to such detection of evasion of duty.

(2) The Board may, by notification in the official Gazette, prescribe the procedure in this behalf and also specify the apportionment of reward sanctioned under this section for whistleblowers.

(3) The claim for reward by the whistleblower shall be rejected, if-

(a) the information provided is of no value;

(b) the Board already had the information;

(d) no collection of duty is made from the information provided from which the Board can pay the reward.

(4) For the purpose of this section, “whistleblower” means a person who reports concealment or evasion of duty leading to detection or collection of duty, corruption or misconduct, to the competent authority having power to t ake action against the person or a federal excise authority committing fraud, corruption, misconduct, or involved in concealment or evasion of duty.]

Section 43. Removal of difficulties and condonation of time limit etc

(1) If any difficulty or situation arises in giving effect t o or applying the provisions of this Act or the rules made or notifications issued there under,

1 Section 42D added by Finance Act, 2015.

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the Board may, through a general order or otherwise, issue instructions or directions for such actions to be taken by an officer of 1[Federal Excise] or any other person as it considers necessary or expedient for the purpose of removing the difficulty or tackling such situation and every such officer or person shall be bound to comply with such instructions or directions in such manner as may be specified therein.

(2) Where any time or period has been specified under any of the provisions of this Act or rules made there under within which any application is to be made or any act or thing is to be done, the Board may 2[at any time before or after the expiry of su ch time or period], in any case or class of cases, permit such application to be made or such act or thing to done within such time or period as it may consider appropriate provided that the Board may subject to such limitations or conditions as may be specified therein, empower any 3[Commissioner] or other 4[officer of Inland Revenue] to exercise the powers under this subsection in any case or class of cases.

5[Explanation.– For the purpose of this section, the expression “any act or thing is to be done ” includes any act or thing to be done by the registered person or by the authorities specified in section 29 of this Act.]

[6] Section 43A. Issuance of duplicate of 7[Federal Excise] documents

An officer of federal excise not below the rank of Assistant Collec tor may, on

1 Words “Inland Revenue” substituted for Federal Excise by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made b y Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance

No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 2 Words inserted by Finance Act, 2022.

4 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was ma de by Finance

(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 20 10 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 5 Explanation inserted by Finance Act, 2011.

6 Inserted vide Finance Act, 2008.

7 The “Inland Revenue” were substituted for “Federal Excise by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was ma de by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Ori ginally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

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payment of one hundred rupees, issue an attested duplicate of any 5[federal excise] document as is available with the department or has been filed under this Act or rules made there under to a relevant registered person applying for the same.]

Section 44. Refund of duty

(1) No refund of any amount of duty accrued for any reason under this Act or rules made there under shall be allowed unless claimed within one year of its accrual.

(2) In a case where a registered person did not avail adjustment of duty admissible at the relevant time, the 1[Commissioner] may allow such person to avail the adjustment at any subsequent time provided that claim for such adjustment is made within a period of one year from the date on which it was admissible.

(3) In a case where claim for refund or adjustment has accrued in consequence of any decision or judgment of any Federal Excise Officer, the Tribunal or Court, the period of one year, for the purpose of this section, shall be computed from the date of such decision or judgment.

[2] Section 44A. Delayed refund

Where a refund due under section 44 is not made within the time specified in this behalf, there shall be paid to the claimant, in addition the amount of refund due to him, a further sum equal to KIBOR per annum of the amount of refund due, from the date following the expiry of the time specified as aforesaid, to the day preceding the day of payment of refund:

Provided that where there is a reason to believe that a person has claimed the refund which is not admissible to him, he shall not be entitled to additional amount unless the investigation of his claim is completed.]

Section 45. Access to records and posting of excise staff, etc

(1) A person who is required to maintain any record or documents under this Act or any other law shall, as and when required by the 3[officer of Inland

1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This O rdinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259

2 Inserted vide Finance Act, 2009.

3 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Or iginally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

The Federal Excise Act, 2005

Revenue] produce record or documents which are in his possession or control or in the possession or control of his agent and where such record or documents have been kept on electronic data, he shall allow access to such officer to have access and use of any machine on which such data is kept and shall facilitate such officer to retrieve whole or part of such data in such manner and to such extent as may be required by him.

(2) Subject to such conditions and restrictions, as deemed fit to specify, the Board 1[***] may, post 3[officer of Inland Revenue] to the premises of registered person or class of such persons to monitor production, removal or sale of goods and the stock position or the main tenance of records 2[.]

2[***]

3[(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.]

[4] Section 45A. Monitoring or tracking by electronic or other means

(1) Subject to such conditions, restriction and procedures as it may deem fit to impose or specify, the Board may, by notification ion the official Gazette, specify any registered person or class of registered persons or any goods or class of goods in respect of which monitoring or tracking of production, sales, clearance, stocks or any other related activ ity may be implemented through electronic or other means as may be prescribed.

(2) From such date, as may be prescribed by the Board, no excisable goods shall be removed or sold by the manufacturer or any other person without affixing tax stamp, banderol e, stickers, labels, 5[barcodes,]

etc. in any such form, style and manner as may be prescribed by the Board in this behalf.]

1 Words “or Chief Commissioner” omitted by Finance Act, 2018. 2 Full stop inserted and proviso omitted by Finance Act, 2018.

3 Inserted vide Finance Act, 2008.

4 Section 45A inserted by Finance Act, 2013. 5 Word and comma inserted by Finance Act, 2015.

The Federal Excise Act, 2005

1[(3) Such tax stamps, banderoles, stickers, labels, barcodes etc., shall be acquired by the registered person referred to in sub -section (2) from a licensee appointed by the Board for the purpose, against price approved by the Board, which shall include the cost of equipment installed by such licensee in the premises of the said registered person.]

[2] Section 45AA. Licensing of brand name

(1) Manufacturers of the specified goods shall be required to obtain brand licence for each brand or stock keeping unit (SKU) in such manner as may be prescribed by the

Board.

(2) Any specified brand and SKU found to be sold without obtaining a licence from the Board shall be deemed counterfeit goods and liable to outright confiscation and destruction in the prescribed manner and such destruction and confiscation shall be without prejudice to any other penal action which may be taken under this Act.]

46. 3[***] Audit.— (1) The 4[officer of Inland Revenue] authorized by the Board 5[or the Commissioner] by designation may, once in a year, after giving advance notice in writing, conduct audit of the records and documents of any person registered under this Act.

(2) In case the 6[Commissioner] has information or sufficient evidence showing that such registered person is involved in fraud or evasion of duty, he may authorize a Federal Excise Officer, not below the

1 Sub-section (3) added by Finance Act, 2015. 2 New Section 45AA inserted by Finance Act, 2021. 3 Word “Departmental” omitted by Finance Act, 2015.

4 Substituted for “Federal Excis e Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not a pprove it.

Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 5 Words inserted by Finance Act, 2010.

6 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordin ance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259.

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rank of 1[Assistant Commissioner], to conduct audit at any time in a year. 2[(2A) After completion of the audit under this section or any other provision of law, the officer of Inland Revenue may, after obtaining the registered person’s explanation on all the issues raised in the audit shall pass an order under section 14, imposing the amount of duty as per law, charging default surcharge, imposing penalty and recovery of any amount erroneously refunded.]

(3) Notwithstanding the penalties prescribed in section 19, if a registered person wishes to deposit the amount of duty not paid, short paid or the amount of duty evaded along with default surcharge voluntarily, whenever it comes to his notice, before commencement of audit, no penalty shall be recovered from him:

Provided that if a registered person wishes to deposit the amount of duty not paid, short paid or amount of duty evaded along with default surcharge during or after the audit but before the 3[determination of liability under sub-section (2A)] conclusion of original adjudication proceedings, he may deposit such amount along with twenty five percent of the amount of penalty prescribed under this Act or the rules made there under and in such case, further proceedings in the case shall abate. 4[(4) The Board may appoint as many special audit p anels as may be necessary, comprising two or more members from the following –

(a) an officer or officers of Inland Revenue;

(b) a firm of Chartered Accountants as defined under the Chartered Accountants Ordinance, 1961 (X of 1961);

1 Substituted for “Assistant Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53.

This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it.

Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 2 Sub-section (2A) inserted by Finance Act, 2010.

3 Substituted for “conclusion of original adjudication proceedings” by Finance Act, 2010 w.e.f. June 5, 2010

4 Substituted for sub-section (4) by Finance Act, 2015.

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1966); or

(d) any other person as directed by the Board,

to conduct audit of a registered person or persons, including audit of refund claims and fo rensic audit and the scope of such audit shall be determined by the Board or the Commissioner Inland Revenue on a case -to-case basis. In addition, the Board may, where it considers appropriate, also get such audit conducted jointly with similar audits bein g conducted by provincial administrations of sales tax on services.]

1[(5) Each special audit panel shall be headed by a chairman who shall be an officer of Inland Revenue;

(6) If any one member of the special audit panel, other than the chairman, is absent from conducting an audit, the proceedings of the audit may continue and the audit conducted by the special audit panel shall not be invalid or be called in question merely on the ground of such absence.

(7) The Board may prescribe rules in respect of constitution, procedure and working of special audit panel.

(8) Every member of the special audit panel shall have the powers of officers of Inland Revenue under sections 23 and 45 and sub - sections (1) to (3) of section 46.]

2[9] The audit of the re gistered person shall generally be a composite audit covering all duties and taxes to which his business or activity is liable under the laws administered by the Board.

3[***]

1 Sub-sections (5), (6), (7) and (8) inserted by Finance Act, 2015. 2 Sub-section (5) re-numbered as sub-section (9) by Finance Act, 2015. 3 Sub-section (10) omitted by Finance Act, 2020.

The Federal Excise Act, 2005

[1] Section 47. Service of notices and other documents

(1) Subject to this Act , any notice, order or requisition required to be served on a resident individual other than in a representative capacity for the purposes of this Act shall be treated as properly served on the individual if–

(a) personally served on the individual or, in th e case of an individual under a legal disability or a non -resident individual, the representative as defined in section 172 of the Income Tax Ordinance, 2001 (XLIX of 2001) of the individual;

(b) sent by registered post or courier service to the place specified in clause (b) of sub-section (2) or to the individual’s usual or last known address in Pakistan; or

(c) served on the individual in the manner prescribed for service of a summons under the Code of Civil Procedure, 1908 (Act V of

1908) 1[; or]

2(d) sent electronically through email or to the e -folder maintained for the purpose of e -filing of sales tax -cum-Federal excise returns by the 3[registered person.]

(2) Subject to this Act, any notice, order or requisition required to be served on any person (other than a resident individual to whom sub-section

(1) applies) for the purposes of this Act, shall be treated as properly served on the person if–

(a) personally served on the representative of the person;

(b) sent by registered post or courie r service to the person’s registered office or address for service of notices under this Act, in Pakistan, or where the person does not have such office or

1 Section 47 substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Par liament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 2 The word “or” and clause (d) added by Finance Act, 2017. 3 Words substituted by Finance Act, 2020.

The Federal Excise Act, 2005

address, the notice is sent by registered post to any office or place of business of the [person in Pakistan; or

(c) served on the person in the manner prescribed for service of a summons under the Code of Civil Procedure, 1908 (V of 1908) 1[; or

(d) sent electronically through email or to the e -folder maintained for the purpose of e -filing of sales tax-cum-Federal excise returns by the 1[registered person.]

(3) Where as association of person is dissolved, any notice, order or requisition required to be served under this Act, on the association may be served on any person who was the principal office r or a member of the association immediately before such dissolution.

(4) Where, business stands discontinued, any notice, order or requisition required to be served under this Act, on the person discontinuing the business may be served on the person personally or any individual who was the person’s representative at the time of discontinuance,

(5) The validity of any service of a notice under this Act, shall not be called into question after th e notice has been complied with in any manner.]

[2] Section 47A. Agreements for the exchange of information 3[or assistance in recovery of duties .]

(1) The Federal Government may enter into bilateral or multilateral agreements with provincial governments or with governments of foreign countries for the exchange of information, including electronic exchange of information, with respect to excise duty imposed under this Act or any other law of Paki stan, or under the corresponding laws of that country and may, by notification in the official Gazette, make such provisions as may be necessary for implementing such agreements.

1 The word “or” and clause (d) added by Finance Act, 2017. 2 Sections 47A and 47B added by Finance Act, 2015. 3 Words inserted by Finance Act, 2021.

The Federal Excise Act, 2005

1[(1A) Notwithstanding anything contained in this Act, the Board shall hav e power to share data or information including real time data videos, images received under the provisions of this Act with any other Ministry or Division of the Federal Government or Provincial Government, subject to such limitations and conditions an may be specified by the Board.]

(2) The provisions of section 107 of the Income Tax Ordinance, 2001 (XLIX of 2001) shall, mutatis mutandis, apply to this section.

2[(3) The Federal Government may enter into a bilateral or multilateral convention, and inter -governmental agreement or similar agreement or mechanism for assistance in the recovery of duties.]

[3] Section 47AB. Real-time access to information and databases

─ (1) Notwithstanding anything contained in any law for the time being in force, including but not limited to the National Database and Registration Authority Ordinance, 2000 (Ordinance VIII of 2000) and the Emigrati on Ordinance, 1979 (Ordinance XVIII of 1979), arrangements shall be made to provide real-time access of information and database to the Board in the prescribed form and manner by–

(a) the National Database and Registration Authority with respect to informa tion pertaining to National Identity Card (NIC), Pakistan Origin Card, Overseas Identity Card, Alien Registration Card and other particulars contained in the citizen database;

(b) the Federal Investigation Agency and the Bureau of Emigration and Overseas E mployment with respect to details of international travel;

(c) the Islamabad Capital Territory and provincial and local land record and development authorities with respect to record-of-rights including digitized edition of record -of- rights, periodic reco rd, record of mutations and report of acquisition of rights;

1 New sub-section (1A) inserted by Finance Act, 2021. 2 New sub-section (3) inserted by Finance Act, 2021. 3 New section 47AB inserted by Finance Act, 2020.

The Federal Excise Act, 2005

(d) the Islamabad Capital Territory and provincial excise and taxation departments with respect to information regarding registration of vehicles, transfer of ownership and other associated record;

(e) all electricity suppliers and gas transmission and distribution companies with respect to particulars of a consumer, the units consumed and the amount of bill charged or paid:

Provided that where the connection is shared or is used by a person othe r than the owner, the name and NIC of the owner and the user shall also be furnished:

Provided further that all electricity suppliers and gas transmission and distribution companies shall make arrangements by the 1st day of January, 2021 for allowing consumers to update the ratio of sharing of a connection or the particulars of users, as the case may be; and

(f) any other agency, authority, institution or organization notified by the Board.

(2) The Board shall make arrangements for laying the infrastructure for real -time access to information and database under sub - section (1) and aligning it with its own database in the manner as may be prescribed.

(3) Until real-time access to information and database is made available under sub -section (1), such infor mation and data shall be

provided periodically in such form and manner as may be prescribed.

(4) Subject to section 47B, all information received under this section shall be used only for tax purposes and kept confidential.]

The Federal Excise Act, 2005

[1] Section 47B. Disclosure of info rmation by a public s ervant

─ (1) Any information acquired under any provision of this Act shall be confidential and no public servant shall disclose any such information, except as

provided under section 216 of the Income Tax Ordinance, 2001 (XLIX of 2001).

(2) Notwithstanding anything contained in sub-section (1) and the Freedom of Information Ordinance, 2002 (XCVI of 2002), any information received or supplied in pursuance of bilateral or multilateral agreements with government of foreign countries for exchange of information under section 47A shall be confidential].

[2] Section 47C. Validation

3[(1)] All notifications and orders issued and notified in exercise of the powers conferred upon the Federal Government, before the commencement of Finance Act, 2017 shall be deemed to hav e been validly issued and notified in exercise of those powers.]

3[(2) Notwithstanding any omission, irregularity or deficiency in the establishment of or conferment of powers and functions on the Directorate General (Intelligence and Investigation), Inl and Revenue and authorities specified in clause (a) of sub -section (2) of section 29 of this Act, all orders passed, notices issued and actions taken in exercise or purported exercise of the powers and functions of the Officers of Inland Revenue under this Act by the Director General (Intelligence and Investigation), Inland Revenue or the authorities specified in clause (a) of sub-section (2) of section 29 of this Act shall be treated to have been validly passed, issued and taken under this Act.]

Section 48. Repeal

(1) Subject to the provisions of sub -section (2), the Central Excises Act, 1944 (I of 1944) shall stand repealed with effect from the date notified under sub-section (3) of section 1.

(2) Unless otherwise directed by the Federal Government, in case of area where the repealed Act was extended through an order by a Governor of the Province or otherwise through an order by any other authority, the application of the repealed Act shall continue to be in force till this Act is

1 Section 47B substituted through Finance Act, 2016. 2 New section 47C inserted through by Finance Act, 2017. 3 Section 47C re-numbered and new sub-section (2) added by Finance Act, 2018.

The Federal Excise Act, 2005

made applicable in that area.

[1] Section 49. Fee and service charges

2[(1)] The 3[Board with the approval of Federal Minster -in-charge”] may, by notification in the official Gazette, subject to such conditions, limitations or restrictions as it may deem fit to impose, levy fee and service cha rges for valuation, in respect of any other service or control mechanism provided by any formation under the control of the Board, including ventures of public - private partnership, at such rates as may be specified in the notification.] 4[(2) The Board ma y authorize and prescribe the manner in which fee and service charges collected under sub-section (1) shall be expended.]

[5] Section 50. Uniform

The Board may, by notification in the official Gazette, prescribe rules for wearing of uniform by officers and staff of Inland Revenue Services.]

1 New section 49 inserted through Finance Act, 2019. 2 Existing sub-section renumbered as sub-section (1) by Finance Act, 2021. 3 Words “Federal Government” substituted by Tax Laws (Amendment) Act, 2020. 4 New sub-section (2) inserted by Finance Act, 2021. 5 New section 50 added by Finance Act, 2022.

The Federal Excise Act, 2005

FIRST SCHEDULE

[See Section 3]

TABLE 1 (EXCISABLE GOODS)

S.No. Description of Goods Heading/ sub-heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4)

1[1*** omitted]

1[2*** omitted]

3 Concentrates for aerated beverages in all forms including syrup form

2106.9010 Fifty per cent ad val.

4 Aerated waters 2201.1020 2[Twenty] per cent of retail price 5 Aerated waters, containing added sugar or other sweetening matter or flavored

2202.1010 3[Twenty] per cent of retail price 6 Aerated waters if manufactured wholly from juices or pulp of 4[ ] vegetables, food grains or fruits and which do not contain any other ingredient, indigenous or imported, other than sugar, coloring materials, preservatives or additives in Respective headings

5[Twenty] per cent of retail price

1 Serial numbers 1, 2 and entries relating thereto omitted through Finance Act, 2021. 2 The figure “thirteen” substituted through Finance (Supplementary) Act, 2023. 3 The figure “thirteen” substituted through Finance (Supplementary) Act, 2023. 4 Word omitted by Finance Act, 2008. 5 The figure “thirteen” substituted through Finance (Supplementary) Act, 2023.

The Federal Excise Act, 2005

S.No. Description of Goods Heading/ sub-heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4)

quantities prescribed under the West Pakistan Pure Food Rules, 1965.

7 Un-manufactured tobacco 24.01 1[Three hundred and ninety rupees] per kilogram

2[7a Acetate tow Respective heading Rupees forty four thousand per kg.]

3[8

4[8a Cigarettes of tobacco or tobacco substitutes excluding locally produced cigarettes.

E-liquids by whatsoever name called, for electric cigarette kits.

24.02

Respective heading Sixty five percent of retail price or the rate of duty as prescribed against S. No. 9 whichever is higher.

Rupees ten 5[thousand per kg 6[or sixty five percent of retail price whichever is higher].

8b Cigars, cheroots and cigarillos of tobacco and tobacco substitute. Respective heading Sixty five percent of retail price or rupees ten thousand per kg whichever is higher.]

7[8c.

Tobacco mixture in an electrically heated tobacco product by whatever name called, intended for consumption

8[Respective headings]

9[Rupees sixteen thousand five hundred per kg]

1 The figure “ten” substituted through Tax Laws (Second Amendment) Ordinance, 2022. 2 New serial number 7a inserted by Finance Act, 2024. 3 Serial number 8 substituted by Finance Act, 2020. 4 New serial numbers 8a and 8b inserted by Finance Act, 2020. 5 Words substituted by Finance Act, 2022. 6 Words added by Finance Act, 2024. 7 New serial number 8c inserted by Finance Act, 2021. 8 Words substituted by Finance Act, 2022. 9 Expression substituted by Finance Act, 2023

The Federal Excise Act, 2005

S.No. Description of Goods Heading/ sub-heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4)

by using a tobacco heating system without combustion

The Federal Excise Act, 2005

1[8d Nicotine pouches Respective heading Rupees one thousand and two hundred per kg.] 2[9. Locally produced cigarettes if their on -pack printed retail price exceeds 3[twelve thousand five hundred ] rupees per thousand cigarettes. 24.02 Rupees 4[sixteen thousand five hundred] per thousand cigarettes

10. Locally produced cigarettes if their on -pack printed retail price does not exceed 5[ twelve thousand five hundred] per thousand cigarettes. 24.02 Rupees 6[five thousand and fifty ] per thousand cigarettes] 7[10a. ***] omitted.

8[11***]

. 12 Cigarettes manufactured by a manufacturer who remains engaged on and after the 10th June, 1994, either directly or through any other arrangement, if the manufacture of any brand of cigarette in non-tariff areas

24.02 Sixty 9[five] percent of retail

price.

1 New serial number 8d inserted by Finance Act, 2024. 2 Serial numbers 9 and 10 and entries relating thereto substituted through Finance Act, 2019. 3 Words substituted by Finance Act, 2024. 4 Words substituted by Finance (Supplementary), Act 2023. 5 Words substituted by Finance Act 2024. 6 Words substituted by Finance (Supplementary), Act 2023. 7 Serial numbers 10a and entries relating thereto omitted through Finance Act, 2019. 8 Serial No. 11 omitted by Finance Act, 2013.

9 Substituted for “four” by Finance Act, 2010.

The Federal Excise Act, 2005

13 Portland cement, aluminous cement, slag cement, super sulphate cement and similar hydraulic cements, whether or not colored or in the form of clinkers

25.23

1[four] rupees] per kilogram 2[14, 15 and 16*** ]

3[17 & 18]

4[19&20]

5[21***]

6[22 to 25***]

7[26to30***]

31 Liquefied Natural Gas 2711.1100 8[ten rupees per Million British Thermal Unit (MMBTu)] 32 Liquefied propone 2711.1200 Seventeen rupees and eighteen paisa per hundred cubic meters. 33 Liquefied butanes 2711.1300 Seventeen rupees and eighteen paisa per hundred cubic

1 Word “two” substituted by Finance Act, 2024. 2 Serial no. 14, 15 & 16 omitted by Finance Act, 2007. 3 Serial no. 17 and 18 omitted by Finance Act, 2011. 4 Serial no. 19 & 20 Omitted vide Finance Act, 2007. 5 Sr. No. 21 omitted by Finance Act, 2011. 6 Sr. Nos. 22 to 25 omitted by Finance Act, 2012. 7 Sr. Nos. 26 to 30 omitted by Finance Act, 2011. Sr. No. 27 omitted by Finance Act, 2012. 8 The expression substituted through Finance Act, 2019.

The Federal Excise Act, 2005

meters.

34 Liquefied ethylene, propylene, butylenes and butadiene 2711.1400

Seventeen rupees and eighteen paisa per hundred cubic meters. 35 Other Liquefied petroleum Gases and gaseous hydrocarbons 2711.1900 1[Rupees sixty per hundred metric tonne]. 36 Natural Gas in gaseous state 2711.2100 2[ten rupees] per Million British Thermal Unit

(MMBTu) 37 Other petroleum Gases in gaseous state 2711.2900

4[ten rupees] per Million British Thermal Unit

(MMBTu) 3[38***]

4[39 & 40]

41 Flavors and concentrates for use in aerated beverages 3302.1010 Fifty per cent ad valorem. 4[ 42 to 45] omitted 5[46 to 49]

omitted

1 Words substituted by Finance Act, 2022.

2 Substituted vide Finance Act, 2010.

3 Omitted vide Finance Act, 2007.

4 Sr. Nos. 39 to 40 omitted by Finance Act, 2011 & Sr. Nos. 42 to 45 omitted by Finance Act, 2012. 5 Sr. Nos. 46 47, 48 and 49 omitted by Finance Act, 2011

The Federal Excise Act, 2005

1[(53)] 2[54 ***] omitted.

1 Sr.No. 53 omitted through Finance Act, 2016 2 Serial number 54 and entries relating thereto omitted through Finance Act, 2019.

The Federal Excise Act, 2005

1[55

2[55B

Imported m otor cars, SUVs and other motor vehicles, excluding auto rickshaws, principally designed for the transport of persons (other than those of headings 87.02), 4[and till the 30th day of June, 2026 electric vehicles (4 wheelers)] including station wagons and racing cars

(a) of cylinder capacity up to 1000cc

(b) of cylinder capacity from 1001cc to 1799cc

(d) of cylinder capacity exceeding 3001cc

Locally manufactured or assembled motor cars, SUVs and other m otor vehicles, excluding auto rickshaws principally designed for the transport of persons (other than those of headings 87.02), and till the 30th day of June, 2026 electric vehicles (4 wheelers) including station wagons and racing cars:

(a) of cylinder ca pacity up to 1300cc

(b) of cylinder capacity from 1301cc to 2000cc

87.03

2.5% ad val 6[10]% ad val. 7[30]% ad val.

8[40]% ad val.]

2.5 % ad val.

5% ad val.

10% ad val.

1 Serial number 55 and 55A and entries relating thereto substituted by Finance Act, 2019. 2 Serial number 55B and entries relating thereto substituted by Finance (Supplementary) Act, 2022.

The Federal Excise Act, 2005

1[55C

2[55D

3[56

Imported double cabin (4x4) pick-up vehicles

Locally manufactured double cabin (4x4) pick -up vehicles except the vehicles booked on or before the 30 th June, 2020 subject to the restriction or conditions specified by the

Board.

Filter rod for cigarettes 8704.2190 8704.3190

8704.2190 8704.3190

5[Respective headings]

9[30]% ad val]

10[10]% ad val.]

11[Rupees 12[eighty thousand] per kg] 13[57. Omitted]

11[58. Omitted]

14[59. Sugary F ruit juices, syrups and squashes, waters whether or not containing added sugar or artificial sweeteners excluding mineral and aerated waters Respective headings 15[Twenty] percent of retail price]

4 Expression inserted by Finance Act, 2021. 6 Expression substituted by Finance (Supplementary) Act, 2022. 7 Expression substituted by Finance (Supplementary) Act, 2022. 8 Expression substituted by Finance (Supplementary) Act, 2022. 1 New serial number 55C inserted by Finance Act, 2020. 2 New serial number 55D inserted by Finance Act, 2020. 3 Serial number 56 and entries relating thereto in column (2), (3) and (4) added by Finance Act, 2015. 5 Words substituted by Finance Act, 2022. 9 Expression substituted by Finance (Supplementary) Act, 2022. 10 Expression substituted by Finance (Supplementary) Act, 2022. 11 Expression substituted by Finance Act, 2022. 12 Word “fifteen hundred” substituted by Finance Act, 2024. 13 Serial numbers 57, 58 and entries relating thereto omitted through Finance Act, 2021. 14 New serial number 59 added by Finance (Supplementary) Act, 2023. 15 For the word “ten” the word “twenty” substituted by Finance Act, 2023

The Federal Excise Act, 2005

1[60 Energy inefficient fans both locally manufac tured and imported which do not comply with the MEPS, notified by PSQCA Respective heading Rupees two thousand per fan with effect from the 1st day of January, 2024

61 Incandescent bulbs both locally manufactured and imported 8539.2200 and 8539.2990 Twenty percent ad valorem with effect from the 1st day of January, 2024

62 Fertilizers Respective heading Five percent ad valorem.]

2[63 Lubricating oil 2710.1951, 2710.1952 and 2710.1953 Five percent ad valorem.] 3[64 Day Old Chick (DOC) Respective Heading Rs.10 Per DOC] Interpretation.–– (1) Unless the intent appears otherwise, for the purpose of levy of duty of excise, the description of goods shall prevail upon the tariff classification. However in order for interpretation of description of any goods or verification of any characteristics of any product, the reliance shall be made on the relevant version of the Explanatory Notes to the Harmonized Commodity Description and Coding System.

(2) The rate of duty mentioned in column (4) of the above table shall also apply on the goods mentioned in column (2) thereof, if imported, or brought from non-tariff to tariff areas in case of notified goods. 4[Restriction-1– Reduction.– For the purpose of levy, collection

1 New serial numbers 60 to 62 inserted by Finance Act, 2023. 2 New serial numbers 63 inserted by Finance Act, 2024. 3 Serial number 64 inserted by Finance Act, 2025. 4 Restriction-1 & Restriction-3 substituted by Finance Act, 2017

The Federal Excise Act, 2005

and payment of duty at the rates specified in column (4) against serial number 9 1[and 10] , no cigarette manufacturer shall reduce retail price from the level adopted on the day of the announcement of the latest budget].

2[(2) Restriction-2 – Brand variants at different price points ].– No manufacturer or importer of cigarette can introduce or sell a new cigarette brand variant at the same existing brand family at a price lower than the lowest actual price of the existing variant of the same brand family. For the purposes of this restric tion, current minimum price variant of existing brand means the lowest price of a brand variant on the day of announcement of Budget 3[of the current Financial year] 4[]

[Explanation.– For the purpose of this restriction, brand variant means any cigarette brand with similar logo, name, colour, design, pattern or any unique distinguishing mark associated with an existing brand family.]

1[(3) Restriction-3 – Minimum price. – No brand shall be priced and sold at a retail price (excluding sales tax) lower than 5[fifty five] percent of the retail price under column (2) against serial number 9 of Table-I of the First Schedule to this Act.]

6[(4) Rate of Duty - Notwithstanding the limitation on the retail price under column (2) against serial number 9, manufacturers whose brands were liable to duty at the rates specified in column (4) against serial number 9, one day before the date of amendment (through a notification, an ordinance or an act of parliament), shall continue to collect and pay the duty agains t serial number 9 at the amended rates specified in column (4) (through a notification, an ordinance or an act of parliament)].

1 The words added through Finance Act, 2019. 2 Marginal heading substituted by Finance Act, 2024. 3 Words substituted by Finance Act, 2014. 4 For full stop at the end, explanation added by Finance Act, 2024. 5 Word ‘sixty’ substituted by Finance Act, 2024. 6 Expression added by Finance (Supplementary) Act, 2023.

The Federal Excise Act, 2005

TABLE II (EXCISABLE SERVICES)

S.No. Description of 1[Services] Heading/sub- heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4) 1 Advertisement on closed circuit T.V. 9802.3000

Sixteen per cent of the charges. 2 Advertisements on cable T.V. network. 9802.5000

Sixteen per cent of the charges. 2a 2[Advertisements in news papers and periodicals (excluding and Classified advertisements) of hoarding boards, poles Signs and sign boards. 9802.4000 and 9802.9000 Sixteen per cent of the charges.] 3 3[Facilities for travel

(a) Services provided or rendered in respect of travel by air of passengers within the territorial jurisdiction of Pakistan

4[(i) Long routes

(ii) Short routes

5[(iii) * * *]

Explanation: For the purpose of this entry, “Long routes” means journeys exceeding 500 kilometers, short routes 98.03

9803.1000

2[Fifteen Hundred] rupees

3[Nine Hundred] rupees

1 Words substituted by Finance Act, 2021.

2 Inserted vide Finance Act, 2009.

3 Inserted by Finance Act, 2014.

4 Inserted by Finance Act, 2014 5 Sub-clause (iii) and entry relating thereto in column (4) omitted by Finance Act, 2015.

The Federal Excise Act, 2005

S.No. Description of 1[Services] Heading/sub- heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4) means the remaining journeys, o ther than socio-economic route 1[as defined in S. No. 9 of Table II of the Third Schedule]. Routes exempt from duty as on 1st July, 2014 shall, however, remain exempt.

4[(b) Services provided or rendered in respect of travel by air of passengers embarking on international journey from Pakistan,– [(i) Economy and economy plus air tickets issued on or after the 1st day of July, 2024. [(ii) Club, business and first class air tickets issued on or after the 1st day of July, 2024:

Twelve thousand five hundred rupees

(a) IATA Traffic Conference Area 1 (North, Central, South America and Environs)

(b) IATA Traffic Conference Area 2

(a) Three hundred and fifty thousand rupees

2 The figures substituted through Finance Act, 2019. 3 The figures substituted through Finance Act, 2019.

1 Substituted for the expression “, and “socio-economic routes” means journeys along the Baluchistan coastal belt” by Finance Act, 2015.

4 Serial number 3(b) substituted by Finance Act, 2024.

The Federal Excise Act, 2005

S.No. Description of 1[Services] Heading/sub- heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4)

(I) Middle East and Africa

(II) Europe

(b)(I) One hundred and five thousand rupees

(b)((II) Two hundred and ten thousand rupees

4 Inland carriage of goods by air 9804.1000 3[Sixteen] per cent of the charges.

Shipping agents

9805.1000

(i) Two hundred rupees per house - bill of lading issued in case of Non-Vessel Operating Common Ca rriers (NVOCC), International Freight

ii) 1[sixteen] per cent of the charges in case of other categories of shipping agents.

2[6

Telecommunication services 3[, excluding such services in the area of a Province where such Province has imposed

98.12 (All sub headings )

4[nineteen and half] per cent of charges

1 Substituted vide Finance Act, 2008.

2 Serial no. 6 substituted by Finance Act, 2008. 3 Comma and words added by Finance Act, 2014. 4 For the word “sixteen” the word “nineteen and half” substituted by Finance Act, 2022.

The Federal Excise Act, 2005

S.No. Description of 1[Services] Heading/sub- heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4) Provincial sales tax and has started collecting the same through its own Board or Authority, as the case may be.]

1[6A

2[ 7*** ] Following telecommunication services:

Mobile phone call, if call duration exceeds five minutes;

Respective sub-heading of 98.12 Seventy five paisa per call in addition to the rates of duty specified under Serial No.6] 38 Services provided or rendered by banking companies 4[excluding Merchant Discount Rate

(MDR) for accepting digital payment] , insurance companies, cooperative financing societies, modarabas , musharikas, leasing companies, foreign exchange dealers, non - banking financial institutions, Assets Management Companies 98.13 Sixteen percent of the charges.]

1 New serial number 6A and entries relating thereto inserted by Finance Act, 2021. 2 Serial No. 7 and entries relating thereto omitted by Finance Act, 2013. 3 Serial no. 8 substituted by Finance Act, 2013. 4 Words inserted by Finance Act, 2021.

The Federal Excise Act, 2005

S.No. Description of 1[Services] Heading/sub- heading Number Rate of Duty

Col.(1) Col.(2) Col.(3) Col.(4) and other persons dealing in any such services. 1[9 & 10*** ]

2[11 Franchise services, royalty and fee for technical services Respective heading Ten per cent of the charges.] 3[ 12** ]

4[13 Services provided or rendered by stock brokers 9819.1000 Sixteen percent of the charges.]

5[14

Services provided or rendered by port and terminal operators in relation to imports excluding stevedoring services.

9819.9090

Sixteen percent of the charges.]

6[15

Chartered flights

98.03

Sixteen percent of the charges]

7[Note.– The duty on the services as specified against serial numbers 1, 2, 2A, 5, 8, 11 and 13 shall not be levied on services provided in a Province where the provincial sales tax has been levied thereon].

1 Serial Nos. 9 & 10 Omitted vide Finance Act, 2007 2 Serial no. 11 substituted by Finance Act, 2023 3 Serial No. 12 omitted by Finance Act, 2011.

4 Inserted vide Finance Act, 2009.

5 Inserted vide Finance Act, 2009.

6 Serial no. 15 inserted by Finance Act, 2014. 7 Note inserted through Finance Act, 2016.

The Federal Excise Act, 2005

1[TABLE III

(EXCISABLE ITEMS OTHER THAN THOSE MENTIONED UNDER TABLE-I AND TABLE-II)) [See clause (e) of sub-section (1) of section 3]

S.No. Description of Items Heading/sub- heading Number Rate of Duty

(1) (2) (3) (4)

1 2[Omitted.]

2 Supply of white crystalline sugar by any person to a manufacturing, processing or packaging entity.”. Respective heading Rupees fifteen per kg.]

1 Table-III inserted by Finance Act, 2024. 2 Serial No. 1 omitted by Finance Act, 2025.

The Federal Excise Act, 2005

SECOND SCHEDULE

(Goods on which duty is collectible under sales tax mode with entitlement for adjustment with sales tax and vice versa) [See section 7] S.No. Description of Goods Heading/ sub-heading Number 1 2 3

1(1)

[omitted]

3(2)

[omitted]

2[(3)***]

3[(4) [omitted]

1 Serial numbers 1,2 and 4 omitted by Finance Act, 2021. 2 Serial number 3 omitted through Finance Act, 2016

The Federal Excise Act, 2005

THIRD SCHEDULE

(Conditional exemptions) [See Sub-section (1) of section 16]

TABLE-I

(Goods)

S.No. Description of Goods Heading/ sub-heading Number

(1)

Crude vegetable oil, if obtained from the locally grown see ds excluding cooking oil, without having undergone any process other than the process of washing.

5.07, 15.08, 15.09, 15010, 15.11, 15.12, 15.13, 15.14 15.15, 15.16, 15.17 & 15.18

1[2 ***]

(3)

Un-manufactured tobacco or tobacco refuses if used for the purposes other than the manufacturer of cigarettes, smoking mixtures for pipes and cigarettes and cigars and cheroots.

24.01

2[3A ** 3B** ]

(4) Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes,-

24.02

(i) If supplied to Pakistan Navy for consumption by its personnel on board its vessels.

(ii) If made by hand in tapered shape of biris without the use of any manual or power - operated machine in any process of their manufacture.

1 Omitted vide Finance Act, 2007.

2 Omitted vide Finance Act, 2008.

The Federal Excise Act, 2005

S.No. Description of Goods Heading/ sub-heading Number

(iii) If supplied for consumption by the President of Pakistan, the President of Azad Jammu & Kashmir and the Governors of the Provinces, members of their familie s and guests

provided that the cigarettes are manufactured and supplied on the specific written orders of the competent official authority and the cigarettes and their packets are special-crested for the respective privileged House.

(iv) If supplied ag ainst payment in foreign exchange, to M/s Duty Free Shops Ltd for sale in its Duty Free Shops and on board international flight by the Pakistan International Airlines subject to the same conditions and procedures as are applicable for the purposes of exemp tion of customs

duty.

1[5 ***]

6 Motor spirit,– 2710.1110

(i) If supplied to Pakistan Navy for consumption in its vessels

(ii) If supplied for consumption by the International Bank for Reconstruction and Development in its official cars 2710.1110

2[7** 8** ]

9 Sludge and sediment recovered from storage tanks of the incoming vessels or ships meant for breaking

2710.9900

1 Omitted vide Finance Act, 2013.

2 Omitted vide Finance Act, 2013.

The Federal Excise Act, 2005

S.No. Description of Goods Heading/ sub-heading Number 10 Natural gas if produced and used in the same field for drilling, production, pressure maintenance or in any other joint operations including flaring in the same field. 2711.2100 Explanation.- For the purpose of this entry, "Joint Operations" means all marine and land activities, including gas exploration, prospection, development and production activities conducted by Working Interest Owners under a petroleum concession agreement with the Government.

11 Carbon black oil (carbon black feed stock) if imported by 1[a duly registered manufacturer of carbon black].

2707.9910 2713.9010

Goods,-

12 (i) If donated to the President's Funds for Afghan Refugees, Assistance to Palestine and Famine Relief for Africa, provided that before making such donation the manufacturer or importer shall inform in writing to the Collector of Federal Excise or as the case may be, C ollector of Customs about quantity, value and the duty involved on such goods and shall in case of imports, fulfill the conditions and comply with the procedures specified for the purposes of exemption from customs duty.

(ii) If purchased by the Cabinet Di vision, Government of Pakistan, for donation to a foreign country in the event of natural disasters as certified by the Emergency Relief Cell of that Division.

(iii) If supplied against international tender issued by UNICEF, UNDP, WHO, WFP,

Respective headings

1 Substituted for “National Petrocarbon (Pvt.) Limited, Pipri, Karachi as raw material for the manufacture of the carbon black” by Finance Act, 2008.

The Federal Excise Act, 2005

UNHCR, International Red Cross or any other relief agency, for Afghan Refugees subject to the conditions given below, namely,- (

(a) payment for the supply shall be received in foreign currency, which shall be surrendered to the State Bank of Pakistan and the supplier shall receive payment in Pak rupees as per State Bank procedure and foreign exchange regulations;

(b) the goods shall be duly received by the organization which signed the contract, and a certificate to this effect shall be issued by the organization which shall be duly attested by the Chief Commissioner/ Commissioner of Afghan Refugees and will be submitted by the manufacturer to the 1[Commissioner] of Federal excise; and

(iv) If supplied as ship stores to ships and aircrafts leaving for abroad subject to the satisfaction of the Collector of Customs in terms of section 24 of the Customs Act, 1969.

13 Goods imported or supplied under grants -in-aid for which a specific consent has been obtained from the 2[Board].

Respective Heading

2 Substituted vide Finance Act, 2007.

The Federal Excise Act, 2005

15 Goods if imported as bonafide baggage

Goods if imported by Duty Free Shops as baggage free of custom duty, regulatory duty and sales tax under the baggage rules made under the Customs Act, 1969 (IV of 1969). Respective Heading

Respective Heading

16 Any goods 1[,excluding un -manufactured tobacco,] which are manufactured produced in - house by a registered person and use d for the manufacture and production of goods on which duty of excise is paid by such person. 2[omitted]

Respective Headings.

217

3[18*** ] Goods for further manufacture of goods in the Export Processing Zones

Respective Headings.

4[19 Materials and equipment 5[(plant, machinery, equipment, appliances and accessories)] for construction and operation of 6[Gwadar] Port and development of Free Zone for 3[Gwadar] Port as imported by or supplied to China Overseas Ports Holding Company Limi ted (COPHCL) and its operating companies namely (i) China Overseas Ports Holding Company Pakistan (Private) Limited, (ii) Gwadar International Terminals Limited, (iii) Gwadar Marine Services Limited and (iv) Gwadar Free Zone Company Limited, their contract ors and sub -contractors; and Ship Bunker Oils bought and sold to the ships calling on/visiting 3[Gwadar] Port, having Concession Agreement with the Gwadar Port Authority, for a period of forty years, subject to the conditions and procedure as specified und er S. No. 100A of Respective Headings

1 Expression inserted and Explanation omitted by Finance Supplementary (Amendment)Act,2018.

2 Inserted vide Finance Act, 2008.

3 Serial number 18 omitted through Finance Act, 2016. 4 New serial number 19 added through Finance Act, 2016. 5 The expression inserted by Finance Act, 2017. 6 The word “Gwadar” substituted for the word “Gawadar” by Finance Act, 2017.

The Federal Excise Act, 2005

Table-1 of Sixth Schedule to the Sales Tax Act,

1990.

1[20 Supplies made by the businesses to be established in the Gwadar Free Zone for a period of twenty - three years within the Gwadar Free Zone, subject to the condition that the sales and supplies outside the Gwadar Free Zone and into the territory of Pakistan shall be subjected to Federal Excise

Duty.

Respective Headings”; and 2[21 Vehicles imported by China Overseas Ports Holding Company Limited (COPHCL) and its operating companies, namely:–

(a) China Overseas Ports Holding Company Pakistan (Private) Limited;

(b) Gwadar International Terminal Limited;

(d) Gwadar Free Zone Company Limited; for a period of twenty-three years for construction, development and operations of Gwadar Port and Free Zone Area subject to limitations, conditions prescribed under PCT heading 9917 (3).

Respective Headings] 3[22 Equipment imported by M/s China Railway Corporation to be furnished a nd installed in Lahore Orange Line Metro Train Project subject to the following conditions:

(a) that the equipment imported under this serial number shall only be used in the aforesaid Project;

(b) that the importer shall furnish an indemnity bond, in the prescribed manner and format as set out in Annex -A to this serial number, at the time of import to the extent of federal excise duty exempted under this serial number on consignment to consignment basis;

1 New serial number 20 added through Finance Act, 2016. 2 New serial number 21 added by Finance Act, 2017 3 New serial number 22 added by Finance Act, 2018.

The Federal Excise Act, 2005

(c) that the Punjab Mass Transit Authority, established under the Punjab Mass Transit Authority Act, 2015 (ACT XXXIII of 2015), hereinafter referred as the Regulatory Authority, shall certify in the prescribed manner and format as set out in Annex -B to this serial number that the imported equipment is bona fide requirement of the Project under the Contract No. PMA -CR- NORINCO-OL, dated 20.04.2015, hereafter referred as the contract, signed between the Regulatory Authority and CR-NORINCO;

(d) in the event a dispute arises whether any item is entitled to exem ption under this serial number, the item shall be immediately released by the Customs Department against a corporate guarantee, valid for a period of six months, submitted by the importer. A certificate from the Regulatory Authority duly verified by the Tr ansport and Communication Section of the Ministry of Planning, Development and Reform, that the item is covered under this serial number shall be given due consideration by the Customs Department towards finally resolving the dispute;

(e) for the clearance of imported equipment through Pakistan Customs Computerized System the authorized officer of the Regulatory Authority shall furnish all relevant information, as set out in Annex -B to this serial number, online against a specific user ID and password obta ined under section 155D of the Customs Act, 1969 (IV of 1969). In Collectorates or Customs stations where the Pakistan Customs Computerized System is not operational, the Director Reforms and Automation or any other person authorized by

The Federal Excise Act, 2005

the Collector in th is behalf shall enter the requisite information in the Pakistan Customs Computerized System on daily basis, whereas entry of the data obtained from the customs stations which have not yet been computerized shall be made on weekly basis;

(f) that the equip ment, imported under this serial number, shall not be re -exported, sold or otherwise disposed of without prior approval of the Federal Board of Revenue (FBR). In case goods are sold or otherwise disposed of with prior approval of FBR the same shall be subj ect to payment of federal excise duty as may be prescribed by the FBR;

(g) in case the equipment, imported under this serial number, is sold or otherwise disposed of without prior approval of the FBR in terms of condition (f), the same shall be subject to payment of statutory rates of federal excise duty as were applicable at the time of import;

(h) notwithstanding the condition (f) and (g), equipment imported under this serial number may be surrendered at any time to the Collector of Customs having jurisdi ction, without payment of any federal excise duty, for further disposal as may be prescribed by the FBR;

(i) the indemnity bond submitted in terms of condition (b) above shall stand discharged on submission of a certificate from the Regulatory Authority to the effect that the equipment has been installed or consumed in the said Project. In case the equipment is not consumed or installed in the project the indemnity bond shall be discharged on fulfillment of conditions stipulated at (f) or

(g) or (h), as the case may be; and

The Federal Excise Act, 2005

(j) that violation of any of the above conditions shall render the goods liable to payment of statutory rate of federal excise duty leviable on the date of clearance of goods in addition to any other penal action under relevant provisions of the law. Explanation. For the purpose of this provisions, “equipment” shall mean machinery, apparatus, materials and all things to be provided under the contract for incorporation in the works relating to Lahore Orange Line Metro Train Project.

1[23 Imports made by diplomats, diplomatic missions, privileged persons and privileged organizations which are covered under various Acts, Orders, Rules, Regulations and Agreements passed by the Parliament or issued or agreed by the Government of Pakistan. 99.01, 99.02 and 99.05.]

1 New serial number 23 and entries relating thereto inserted by Finance Act, 2024.

The Federal Excise Act, 2005

1[Annex-A [See condition (b)]

INDEMNITY BOND

(On appropriately stamp non -judicial paper attested by a Government servant in BPS 17 or above, an Oath Commissioner, a Notary Public or an officer of a Scheduled Bank) THIS DEED OF INDEMNITY is made on the _________ date of __________BETWEEN Messrs___________ having registered office at _________ (hereinafter called "the importers" which means and includes their successors, administrators, executors and assi gnees) of the one part, and the President of the Islamic Republic of Pakistan through the Collector of Customs _________ (hereinafter called the "Collector of Customs"), of the other part. WHEREAS the Federal Government, by its decision contained in serial number 22 of this table and subject to the conditions thereof, has been pleased to direct that such equipment shall be exempt from the whole of federal excise duty leviable thereon, in accordance with the said serial number 22, if imported for Lahore Orange Line Metro Train Project. AND WHEREAS M/S.____________, the importers have imported the equipment mentioned in the said serial number for the above mentioned project in accordance with the conditions given in the said serial number 22;

NOW, THEREFORE , in consideration of the release of the equipment without recovery of leviable federal excise duty, the importers bind themselves to pay on demand to the Government of Pakistan the sum of Rs. __________ being the federal excise duty and charges leviable o n the equipment, if the importers fail to fulfill the condition (f) or (g) or (h) of the said serial number 22, as the case may be. The importers further agree and bind themselves that the amount covered by this Indemnity Bond shall be recovered as arrear s of federal excise duty under section 202 of the Customs Act, 1969. This Bond shall stand revoked automatically when the Collector of Customs is satisfied that the importers have fulfilled all the conditions of the said serial number 22. Signed by importe rs on this ____________________ day of _______________________201_. Managing Director or person next

1 Annex “A” & “B” added by Finance Act, 2018.

The Federal Excise Act, 2005

in hierarchy duly authorized by MD (Name and permanent address) Collector of Customs (On behalf of President) Witness (1) ________________________________________________ (signature, name, designation and full address) Witness (2) ________________________________________________ (signature, name, designation and full address)

1[Annex-B [See conditions (c) and (e)] NTN or FTN of Importer Approval No. Details of equipment (to be filled by the authorized officer of the Regulatory Authority) to be imported Description and specifications. Quantity/UOM L/C No. or bank contract

No. and B/L. IGM No. Date & Index No. Remarks, if any.

(1) (2) (3) (4) (5) CERTIFICATE BY THE AUTHORIZED OFFICER OF REGULATORY AUTHORITY: It is hereby certified that the description, quantity and other details mentioned above are true and correct. Goods imported are in commensuration with the project requirements and are bona fide requirement of the Project under the Contract. It is further certified that the above items shall not be used for any other purpose except for the Project. Signature: __________________________ Name and Designation: __________________________ Official Stamp: __________________________ Date: __________________________

The Federal Excise Act, 2005

1[24 The following goods, when supplied within the limits of the Border Sustenance Markets, established in cooperation with Iran and Afghanistan:

(i) Animal Fats and Oil and their fractions 1516.1000

(ii) Vegetable Fats and their fractions 1516.2010

(iii) Vegetable Oils and their fractions 1516.2020

Provided that, such items in case of import, shall be allowed clearance by the Customs Authorities subject to furnishing of ban k guarantee equal to the amount of duty involved and the same shall be released after presentation of consumption certificate issued by the Commissioner Inland Revenue having jurisdiction:

Provided further that, the said exemption shall only be available t o a person upon furnishing proof of having a functional business premises located within limits of the Border Sustenance Markets.

25. Import and supply of raw materials, components, parts and plant and machinery by registered persons authorized under Exp ort Facilitation Scheme, 2021 notified by the Board with such conditions, limitations and restrictions.” Respective headings]

2[26 Imports or supplies made by, for or to a qualified investment as specified at Serial No.1 of the First Schedule to the F oreign Investment (Promotion and Protection) Act, 2022 for the period as specified in the Second Schedule to the said Act. Respective heading.]

1 New serial numbers 24 and 25 inserted by Finance Act, 2021. 2 New serial number added by Finance Act, 2023

The Federal Excise Act, 2005

1[27 Imported construction materials and goods imported by M/s China State Construction Engineering Corporation Limited (M/s CSCECL), whether or not locally manufactured, for construction of Karachi - Peshawar Motorway (Sukkur-Multan Section) subject to fulfilment of same conditions, limitations and restrictions as are specified under S. No. 145 of Table-1 of Sixth Schedule to the Sales Tax Act, 1990, provided that total incidence of exemptions of all duties and taxes in respect of construction materials and goods imported for the project shall not exceed ten thousand eight hundred ninety - eight million rupees includin g the benefit of exemption from duties and taxes availed before 30th June, 2018 under the provisions of Sales Tax Act, 1990, the Customs Act, 1969, The Federal Excise Act 2005 and the Income Tax Ordinance, 2001 and the notifications issued thereunder.

Respective headings

1 S. No. 23 occurring for the second time re-numbered as S. No. 27 by Finance Act, 2025.

The Federal Excise Act, 2005

TABLE-II

S. No. Description of Services Heading/ sub-heading Number Col.(1) Col.(2) Col.(3) 1 Advertisements financed out of funds provided under grants-in- aid agreements. Respective heading 1[2 Telecommunication services:

2[(i) ***] omitted.

(ii) Such charges payable on the international leased lines or bandwidth services 3[, excluding those provided by foreign satellite companies,] used by—

(a) software exporting firms registered with the Pakistan Software Exporting Board; and

(b) data an d 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 agr eements with the foreign telecommunication companies. Respective sub- heading of Heading 98.02

3 Marine insurance for export. 9813.1000 4[4 Life insurance 9813.1500 5 Health insurance 9813.1600 6 Crop insurance 9813.1600] 5[7 Live stock insurance 9813.1600] 6[8 ***]

1 Substituted vide Finance Act, 2006.

2 Clause (i) omitted through Finance Act, 2019. 3 The expression added through Finance Act, 2019.

4 Added vide Finance Act, 2008.

5 Inserted vide Finance Act, 2012.

6 Serial number 8 and entries relating thereto omitted by Finance Act, 2013

The Federal Excise Act, 2005

S. No. Description of Services Heading/ sub-heading Number Col.(1) Col.(2) Col.(3) 1[9 Services provided or rendered in respect of travel by air of passengers on “socio economic routes”, which means the shortest part of journeys starting from or ending at an airpo rt located in Makran coastal region, FATA, Azad Jammu and Kashmir, Gilgit - Baltistan or Chitral

98.03 10 Services provided or rendered in respect of travel by air of passengers on international journeys from Pakistan to:

(a) Hajj passengers;

(b) Diplomats; and

9803.1000 11 Advertisements in newspapers and periodicals

9802.4000 12 Services provided or rendered by banking companies and non-banking financial companies in respect of Hajj and Umrah, cheque book, insurance, Musharika and Modaraba financing and utility bill collection.

98.13] 2[13 Chartered flight services used by or for armed forces to move troops and equipment deployed locally or internationally, including those for movement of troops and equipment to UN missions.

98.03] 3[14 Commission paid by State Bank of Pakistan and its subsidiaries to National Bank of Pakistan or any other banking company for handling banking services of Federal or Provincial Governments as State Bank of Pakistan’s agents. Respective heading]

1 Serial number 9, 10, 11 & 12 and entries relating thereto added by Finance Act, 2015 2 Serial number 13 and entries relating thereto added by Finance Act, 2016 3 Serial number 14 and entries relating thereto added by Finance Act, 2018

The Federal Excise Act, 2005

S. No. Description of Services Heading/ sub-heading Number Col.(1) Col.(2) Col.(3) 1[15 Services provided or rendered by, for or to a qualified investment as specified at Serial No.1 of the First Schedule to the Foreign Investment (Promotion and Protection) Act, 2022 for the period as specified in the Second Schedule to the said Act. Respective heading.]

2[FOURTH SCHEDULE] [Omitted]

PCPPI—4311(19)FBR—24-09-2019—2,000 Copies.

1 New serial number added by Finance Act, 2023 2 Fourth Schedule omitted by Finance Act, 2021.

Print contents from the source

Contents  
 
Section Description Page 
 Chapter I – Preliminary 5 
1 Short title, extent and commencement. 5 
2 Definitions. 5-11 
 Chapter-II – Levy, Collection and Payment of duty 12 
3 Duties specified in the First Schedule to be levied. 12 
3A ***] omitted 14 
4 Filing of return and payment of duty etc 14 
5 Zero rate of duty and drawback of duty etc. 16 
6 Adjustment of duties of excise. 16 
7 Application of the provisions of the Sales Tax Act, 1990. 17 
8 Default surcharge. 18 
9 Liability for payment of duty in the case of private companies or 
business enterprises or in case of sale of business ownership. 
19 
10 Applicable value and rate of duty. 19 
11 Collection of excess duty etc. 20 
12 Determination of value for the purposes of duty 20 
13 Registration 21 
14 Recovery of unpaid duty or of erroneously refunded duty or 
arrears of duty, etc 
22 
14A Short paid amounts recoverable. 23 
14B Assessment giving effect to an order. 23 
14C Power of tax authorities to modify orders, etc.– 24 
15 Application of the Customs Act, 1969 (IV of 1969) to Federal 
excise duties 
24 
16 Exemptions 25 
17 Records 26 
18 Invoices 27 
 Chapter-III – Offences and Penalties 29 
19 Offences, penalties, fines and allied matters 29-33 
19A ***] omitted 34 
20 Appointment of Special Judges for trial of offences 34 
The Federal Excise Act, 2005 
 
iii 
Section Description Page 
21 Trial of offences by Special Judge. 34 
21A Appeal against the order of Special Judge. 35 
22 Power to arrest and prosecute. 35-39 
23 Power to summon persons to give evidence and produce 
documents in inquiries 
39 
24 Officers required to assist [officer of Inland Revenue] 40 
 Chapter-IV – Searches, Arrests and Seizures 41 
25 Searches and arrests how to be made 41 
26 Power to seize. 41 
27 Confiscation of goods subject to federal excise duty. 41 
28 Power to release seized conveyance. 42 
 Chapter-V – Powers, Adjudication and Appeals 43 
29 Appointment of Federal excise Officers and delegation of powers. 43-47 
29A Tax Fraud Investigation Wing Inland Revenue 47 
30 Use of powers of subordinate officer 48 
31 Omitted. 49 
32 Option to pay fine in lieu of confiscation of conveyance 49 
33 Appeals to [Commissioner] (Appeals). 49-51 
33A Omitted. 51 
34 Appeals to the Appellate Tribunal. 52 
34A Reference to High Court. 52 
34AB Saving 52 
35 Powers of Board or [Commissioner] to pass certain orders. 53 
36 Power to rectify mistakes in orders. 54 
37 Deposit, pending appeal, of duty demanded or penalty levied. 54 
38 Alternative dispute resolution 55 
39 Exclusion of time taken for copy 56 
 Chapter-VI – Supplemental Provisions 56 
40 Power of Board to make rules 56 
41 Bar of suit and limitation of suit and other legal proceedings. 57 
42 Observance of Board’s orders, directions and instructions. 57 
42A Reference to authorities 58 
The Federal Excise Act, 2005 
 
iv 
Section Description Page 
42B Selection for audit by the Board 58 
42C Reward to Inland Revenue officers and officials 58 
42D Reward to whistleblowers 59 
43 Removal of difficulties and condonation of time etc. 59 
43A Issuance of duplicate of [Federal Excise] documents. 60 
44 Refund of duty. 61 
44A Delayed refund. 61 
45 Access to records and posting of excise staff, etc. 61 
45A Monitoring or tracking by electronic or other means. 62 
45AA Licensing of brand name. 63 
46 Audit. 63 
47 Service of notices and other documents 66 
47A Agreements for the exchange of information or assistance in 
recovery of duties 
67 
47AB Real-time access to information and databases 68 
47B Disclosure of information by a public servant 70 
47C Validation 70 
48 Repeal 70 
49 Fee and service charges 71 
50 Uniform 71

Compare the original stored transcription

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The Federal Excise Act, 2005 
 
i 
 
 
 
 
 
 
 
  
 
 
The  
Federal Excise Act, 2005 
 
As amended up to 30th June, 2025 
 
The amendments made through  
 
Finance Act, 2025 
 
have been shown in Red 
The Federal Excise Act, 2005 
 
ii 
Contents  
 
Section Description Page 
 Chapter I – Preliminary 5 
1 Short title, extent and commencement. 5 
2 Definitions. 5-11 
 Chapter-II – Levy, Collection and Payment of duty 12 
3 Duties specified in the First Schedule to be levied. 12 
3A ***] omitted 14 
4 Filing of return and payment of duty etc 14 
5 Zero rate of duty and drawback of duty etc. 16 
6 Adjustment of duties of excise. 16 
7 Application of the provisions of the Sales Tax Act, 1990. 17 
8 Default surcharge. 18 
9 Liability for payment of duty in the case of private companies or 
business enterprises or in case of sale of business ownership. 
19 
10 Applicable value and rate of duty. 19 
11 Collection of excess duty etc. 20 
12 Determination of value for the purposes of duty 20 
13 Registration 21 
14 Recovery of unpaid duty or of erroneously refunded duty or 
arrears of duty, etc 
22 
14A Short paid amounts recoverable. 23 
14B Assessment giving effect to an order. 23 
14C Power of tax authorities to modify orders, etc.– 24 
15 Application of the Customs Act, 1969 (IV of 1969) to Federal 
excise duties 
24 
16 Exemptions 25 
17 Records 26 
18 Invoices 27 
 Chapter-III – Offences and Penalties 29 
19 Offences, penalties, fines and allied matters 29-33 
19A ***] omitted 34 
20 Appointment of Special Judges for trial of offences 34 
The Federal Excise Act, 2005 
 
iii 
Section Description Page 
21 Trial of offences by Special Judge. 34 
21A Appeal against the order of Special Judge. 35 
22 Power to arrest and prosecute. 35-39 
23 Power to summon persons to give evidence and produce 
documents in inquiries 
39 
24 Officers required to assist [officer of Inland Revenue] 40 
 Chapter-IV – Searches, Arrests and Seizures 41 
25 Searches and arrests how to be made 41 
26 Power to seize. 41 
27 Confiscation of goods subject to federal excise duty. 41 
28 Power to release seized conveyance. 42 
 Chapter-V – Powers, Adjudication and Appeals 43 
29 Appointment of Federal excise Officers and delegation of powers. 43-47 
29A Tax Fraud Investigation Wing Inland Revenue 47 
30 Use of powers of subordinate officer 48 
31 Omitted. 49 
32 Option to pay fine in lieu of confiscation of conveyance 49 
33 Appeals to [Commissioner] (Appeals). 49-51 
33A Omitted. 51 
34 Appeals to the Appellate Tribunal. 52 
34A Reference to High Court. 52 
34AB Saving 52 
35 Powers of Board or [Commissioner] to pass certain orders. 53 
36 Power to rectify mistakes in orders. 54 
37 Deposit, pending appeal, of duty demanded or penalty levied. 54 
38 Alternative dispute resolution 55 
39 Exclusion of time taken for copy 56 
 Chapter-VI – Supplemental Provisions 56 
40 Power of Board to make rules 56 
41 Bar of suit and limitation of suit and other legal proceedings. 57 
42 Observance of Board’s orders, directions and instructions. 57 
42A Reference to authorities 58 
The Federal Excise Act, 2005 
 
iv 
Section Description Page 
42B Selection for audit by the Board 58 
42C Reward to Inland Revenue officers and officials 58 
42D Reward to whistleblowers 59 
43 Removal of difficulties and condonation of time etc. 59 
43A Issuance of duplicate of [Federal Excise] documents. 60 
44 Refund of duty. 61 
44A Delayed refund. 61 
45 Access to records and posting of excise staff, etc. 61 
45A Monitoring or tracking by electronic or other means. 62 
45AA Licensing of brand name. 63 
46 Audit. 63 
47 Service of notices and other documents 66 
47A Agreements for the exchange of information or assistance in 
recovery of duties 
67 
47AB Real-time access to information and databases 68 
47B Disclosure of information by a public servant 70 
47C Validation 70 
48 Repeal 70 
49 Fee and service charges 71 
50 Uniform 71 
 FIRST SCHEDULE 72 
 Table-I 72-82 
 Table-II 83-87 
 Table-III 88 
 SECOND SCHEDULE 89 
 THIRD SCHEDULE 90 
 Table-I 90-102 
 Table-II 103-105 
 FOURTH SCHEDULE [Omitted] 105 
 
 
 
 
The Federal Excise Act, 2005 
 
5 
CHAPTER I 
PRELIMINARY 
1. Short title, extent and commencement. —(1) This Act may 
be called the Federal Excise Act, 2005, 
2. It extends to the whole of Pakistan 
3. It shall come into force on 1st day of July, 2005. 
2. Definitions.—In this Act, unless there is anything repugnant 
in the subject or context,— 
 (1) “adjudicating authority” means any authority competent to 
  pass any order or decision under this Act or the rules made 
  there under , but does not include the Board or Appellate 
  Tribunal; 
 (2) “adjustment” means deduction of amount of duty paid on 
  goods used in the manufacture or production of other goods 
  from the amount of duty payable on such other  goods in the 
  prescribed manner; 
 1[(3) “Appellate Tribunal” means the Appellate Tribunal Inland 
  Revenue established under section 130 of the Income  Tax 
  Ordinance, 2001 (XLIX of 2001);] 
 2[(4) “Board” shall have the same meaning as defined under clause 
  (8) of section 2 of the Income Tax Ordinance, 2001 (XLIX of 
  2001).”; 
  
 
                         
1  Clause (3) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 june 2010 as Parliament did not approve it. Originally this amendme nt was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2  Substituted vide Finance Act, 2024. 
The Federal Excise Act, 2005 
 
6 
 1[(4A) “Chief Commissioner” means a person appointed as the Chief 
  Commissioner Inland Revenue under section 29;] 
 2[(5) “Commissioner” means  a person appointed as a  
  Commissioner Inland Revenue under section 29;] 
 (6) “conveyance” means any means of transport used for carrying 
  goods or passengers such as vessel, aircraft, vehicle or animal 
  etc.; 
 (7) “default surcharge” means surcharge levied under section 8; 
 (8) “distributor” means a person appointed by a manufacturer in or 
  for a specified area to purchase goods from him for sale to a 
  wholesale dealer in that area; 
 3[(8a) “due date”, in relation to furnishing a return under section 4, 
  means the 15 th day of the month following the end of the 
  month, or such other date as the 4[Board] may, by notification 
  in the official Gazette, specify  5[and different dates may be 
  specified for furnishing of different parts or annexures of the 
  return]. 
 6[(8b) “dutiable goods” means all excisable goods specified in the 
  First Schedule except those which are exempt under section 
  16 of the Act; 
 (8c) “dutiable supply” means a supply of dutiable goods made by a 
  manufacturer other than a supply of goods which is exempt 
  under section 16 of the Act; 
                         
1  Clause (4A)  Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 june 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2  Clause (5) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, Promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
3  Inserted vide Finance Act, 2006. 
4 Substituted for the words “Federal Government” by Finance Act, 2017 
5 Expression for full stop at end substituted through Finance Act, 2016. 
6  Inserted vide Finance Act, 2007. 
The Federal Excise Act, 2005 
 
7 
 (8d) “dutiable services” means all excisable services specified in 
  the First Schedule except those which are exempt under 
  section 16 of the Act; 
 (9) “duty” means any sum payable under the provisions  of this  
Act or the rules made there under  and includes the default  
surcharge and the duty cha rgeable at the rate of zero per cent 
1[excluding fee and service charges imposed and collected 
under section 49;] 
 2(9a) “duty due” means duty in respect of supplies                                               
  made or services provided or rendered during a month and 
  shall be paid at the time of filing of return; 
 (10) “establishment” includes an undertaking, firm or company, 
  whether incorporated or not, an association of persons and an 
  individual; 
 (11) “factory” means any premises, including the precincts thereof, 
  wherein or in any part of which goods are manufactured, or 
  wherein or in any part of which any manufacturing process 
  connected with the production of the goods is being carried on 
  or is ordinarily carried on; 
 3[4[(12)] “Officer of Inland Revenue” means any person appointed by 
  the Board as officer of Inland Revenue under section 29 or any 
  person (including an officer of the Provincial Government) 
  entrusted by the Board with any of the powers of an officer of 
  Inland Revenue under this Act or rules made there under;] 
                         
1 Words inserted by Finance Act, 2022. 
2  Inserted vide Finance Act, 2008.  
3 Clause (12) Substituted by Finance Act, 2010 w.e.f. June 5, 2010. The Finance Ordinance states clause 12 to 
be substituted by “(12A)”, however (12a) is already present in the Finance Ordinance. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No . III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was mad e through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
4 Clause (12A) re-numbered as (12) by Finance Act, 2012. 
The Federal Excise Act, 2005 
 
8 
 1(12a) “franchise” means an authority given by a franchiser under  
  which the franchisee is contractually or otherwise granted  any 
  right to produce, manufacture, sell or trade in or do any  other 
  business activity in respect of goods or to provide  service or 
  to undertake any process identified with  franchiser against a 
  fee or consideration including royalty  or techni cal fee,  
  whether or not a trade mark, service mark  ,trade name, logo, 
  brand name or any such representation  or symbol, as the case 
  may be, is involved;” 
 (13) “goods” means goods leviable to excise duty under this Act or 
  as specified in the First Schedule and includes goods  
  manufactured or produced in non-tariff area and brought for use  
  or consumption to tariff area; 
 (14) “goods insurance” includes fire, marine, theft, accident and 
  other such miscellaneous insurance; 
 (15) “import” and “export” mean respectively bringi ng into, and 
  taking out of Pakistan by sea, land or air  and shall be  
  deemed to have always been so  defined; 
 2(15a) “KIBOR” means Karachi Inter Bank Offered Rate prevalent 
  on first day of each quarter of the financial year;” 
 (16) “manufacture” includes,— 
 
 (a) any process incidental or ancillary to the completion of a 
  manufactured product; 
 (b) any process of re -manufacture, remaking, reconditioning 
  or repair and the processes of packing or repacking such 
  product, and, in relation to tobacco, includes the  
  preparation of cigarettes, cig ars, cheroots, biris, cigarette 
  and pipe or hookah tobacco, chewing tobacco or 3[snuff, 
  or preparation of unmanufactured tobacco by drying, 
  cutting and thrashing of raw tobacco,]  and the word 
                         
1 Clause (12a) inserted by Finance Act, 2008. 
2 Inserted vide Finance Act, 2009. 
3 Substituted for “snuff,” by Finance Act, 2011. 
The Federal Excise Act, 2005 
 
9 
  "manufacturer" shall be construed accordingly and shall 
  include,– 
 (i) any person who employs hired labour in the  
  production or manufacture of goods; or 
 (ii) any person who engages in the production or  
  manufacture of goods on his own account if such 
  goods are intended for sale; and 
 (c) any person wh o, whether or not he carries out any  
  process of manufacture himself or through his employees 
  or any other person, gets any process of  manufacture 
  carried out on his behalf by any person  who is not in his 
  employment: 
Provided that any person so deal ing in goods shall be 
deemed to have manufactured for all purposes of this Act, 
such goods in which he deals in any capacity whatever; 
 [(16a) “non-fund banking services” includes all non -interest based 
services provided or rendered by the banking companie s or 
non-banking financial institutions against a consideration in 
the form of a fee or commission or charges;”;] 
 (17) “non-tariff area” means Azad Jammu and Kashmir, Northern 
Areas and such other territories or areas to which this Act 
does not apply; 
 (18) “person” includes a company, an association, a body of 
individuals, whether incorporated or not, a public or local 
authority, a Provincial Government or  the Federal 
Government; 
 (19) “prescribed” means prescribed under this Act or by rules 
made there under; 
 1[(19a) “property developers or promoters” means persons engaged in 
                         
1 Inserted vide Finance Act, 2008. 
The Federal Excise Act, 2005 
 
10 
development of purchased or leased land for conversion into 
residential or commercial plots or construction of residential 
or commercial units for sale;] 
 (20) “registered person” me ans a person who is registered or is 
required to be registered under this Act provided that a person 
who is not registered but  is required to be registered shall not 
be entitled to any benefit or privilege under this Act or rules 
made there under, unless he is registered and such benefit and 
privilege, unless allowed by Board, shall be confined to 
period of registration; 
 (21) “sale” and “purchase” with their grammatical  variations and 
cognate expressions, mean any  transfer of the possession of 
goods or rendering and  providing of services by one person 
to another in the ordinary course of trade or business for cash 
or deferred payment or other consideration;                                              
 1[(21a) “sales tax mode” means the manner of collection and payment 
under the Sales Tax Act, 1990, and rules made there under, of 
the duties of excise chargeable under this Act specified to be 
collected  and paid as if such duties were tax chargeable under 
section 3 of the said Act and all the provisions of that Act and 
rules, notifications, orders and instructions made or issued 
there under shall, mutatis mutandis, apply to the excise duty 
so chargeable;] 
 (22) “Schedule” means the schedule appended to this  Act; 
 (23) “services” means services, facilities  and utilities  leviable to 
excise duty under this Act or as  specified in  the First  
Schedule read with Chapter 98 of the Pakistan Customs 
Tariff, including the services, facilities and utilities originating 
from Pakistan or its tariff area or terminating in Pakistan or its 
tariff area; 
 2[(23a) “supply” includes sale, lease or other disposition of goods and 
                         
1 Inserted vide Finance Act, 2007. 
2  Inserted vide Finance Act, 2007. 
The Federal Excise Act, 2005 
 
11 
shall include such transaction as the 1[Board, with the 
approval of the Federal Minister-in-charge,] may notify in the 
official  Gazette from time to time;] 
 (24) “tariff area” means area other than the non-tariff  area; 
 2[(24A) “un-manufactured tobacco”  means tobacco useable for 
manufacture of cigarettes as manufactured by Green Leaf 
Threshing Units after processing and conversion of tobacco 
green leaf;] 
 3[(24B) “whistleblower” means whistleblower as defined in  section 
42D of the Federal Excise Act, 1990;] 
 (25) “wholesale dealer” means a person who buys or  sells goods 
wholesale for the purpose of trade or manufacture, and 
includes a broker or commiss ion agent who, in addition to 
making contracts for the  sale or purchase of goods for others, 
stocks such goods belongin g to others as an agent for the 
purpose of sale; and 
 (26) “zero-rated” means duty of Federal excise levied and charged 
at the rate of zero per cent under section 5 of this act.  
 
 
 
 
 
       
 
                         
1  The words “Federal Government” substituted by Finance Act, 2019. 
2  New clause 24A inserted by Finance Supplementary (Amendment) Act, 2018 
3  Earlier clause 24A re-numbered as clause 24B by Finance Supplementary (Amendment) Act, 2018 
The Federal Excise Act, 2005 
 
12 
CHAPTER II 
LEVY, COLLECTION AND PAYMENT OF DUTY 
3.  Duties specified in the First Schedule to be levied. —(1) 
Subject to the provisions of this Act and rules made there under, there shall 
be levied and collected in such manner as may be prescribed duties of excise 
on,— 
 (a) goods produced or manufactured in Pakistan; 
 (b) goods imported into Pakistan  1[, irrespective of their final 
destination in territories of Pakistan];  
 (c) such goods as the 2[Federal Government] may, by notification 
in the official Gazette, specify, as are produced or 
manufactured in the non -tariff areas and are brought to the 
tariff areas for sale or consumption therein; 3[***] 
  4[(d) services provided in Pakistan including the services originated 
outside but rendered in Pakistan; 5[and] 
     6[(e)   any item not covered in clause (a) to (d) above and specified 
in the First Schedule.] 
at the rate of 7[fifteen] per cent ad valorem except the goods and services 
specified in the Firs t Schedule, which shall be charged to Federal excise 
duty as, and at the rates, set-forth therein. 
(2) Duty in respect of goods imported into Pakistan shall be 
levied and collected in the same manner and at the same time as if it were 
a duty of customs payable under the Customs Act, 1969 (IV of 1969), and 
the provisions of the said Act including section 31A thereof shall apply. 
                         
1  The expression inserted by Finance Act, 2017. 
2  Words “Federal Government” substituted by Finance Act, 2018. 
3      Word omitted by Finance Act, 2023 
4   Inserted vide Finance Act, 2008. 
5  Word added by Finance Act, 2023 
6  New clause added by Finance Act, 2023 
7   Substituted “fifty” vide Finance Act, 2006. 
The Federal Excise Act, 2005 
 
13 
(3) The Board may, by notification in the official Gazette, in lieu 
of levying and collecting under sub -section (1) duties of excis e on goods 
and services, as the case may be, levy and collect duties,— 
 
 (a) on the production capacity of plants, machinery, undertakings, 
establishments or installations producing or manufacturing 
such goods; or 
 (b) on fixed basis, as it may deem fit, o n any goods or class of 
goods or on any services or class of services, payable by any 
establishment or undertaking producing or manufacturing 
such goods or providing or rendering such services. 
 1[(3A) Subject to the provision of sub -section (3) of section 6 or any 
notification issued there under, where excisable goods and services are 
supplied to a person who has not obtained registration number, the Federal 
Government may, by notification in the official Gazette, charge, levy and 
collect, on the excisable goods and services specified in that notification, a 
further duty at the rate of two percent of the value in addition to the rate 
specified in sub-sections (1), (3), (4) and (5) of this section.] 
 (4) Without prejudice to other provisions of this Act, the  
2[Federal Government] may levy and collect duty on any class or classes of 
goods or  services by notification in the official Gazette at such higher or 
lower rate or rates as may be specified in such notification. 
 3[(5) The liability to pay duty shall be— 
 (a) in case of goods produced or manufactured in Pakistan, 
of the person manufacturing or producing such goods; 
           (b)   in case of goods imported into Pakistan, of the person 
importing such goods; 
 (c) in case of services provided or rendered in  Pakistan, of 
the person providing or rendering such service  
                         
1 Sub-section (3A) inserted by Finance Act, 2013. 
2 Words “Federal Government” substituted by Finance Act, 2018. 
3 Sub-section (5) inserted by Finance Act, 2013. 
The Federal Excise Act, 2005 
 
14 
1[, provided where services are rendered by the person 
out of Pakistan, the recipient of such service in Pakistan 
shall be liable to pay duty; 2[omitted] 
           (d)  in case of goods produce d or manufactured in non -tariff 
areas and brought to tariff areas for sale or consumption 
therein, of the person bringing or causing to bring such 
goods to tariff areas 3[; and  
(e)   in any other case, of the person including any middle  
man as may be spec ified under the provisions of this 
Act.] 
 4[(5A) In respect of goods, specified in the Fourth Schedule, the 
minimum production for a month shall be determined on the basis of a 
single or more inputs as consumed in the production process as per 
criterion specified in the Fourth Schedule and if minimum production so 
determined exceeds the actual supplies for the month, such minimum 
production shall be treated as quantity supplied during the month and the 
liability to pay duty shall be discharged accordingly.] 
Explanation.– Subject to sub -section (1), for the purpose of this section, 
“goods” means the goods specified in CHAPTERS 1 TO 97 and “services” 
means the services specified in CHAPTER 98 of the First Schedule to the 
Customs Act, 1969 (IV of 1969). 
  5[3A***] 
 4. Filing of return and payment of duty etc.— 6[(1) 7[For every 
month, a registered person ] 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.] 
                         
1 Words etc. inserted by Finance Act, 2008. 
2     In clause (c), the word “and” occurring at the end is omitted by Finance Act,2025. 
3       In clause (d), for the full stop at the end, the expression “; and” is substituted and thereafter the new clause 
(e)added by Finance Act,2025. 
4 New sub-section (5A) inserted through Finance Act, 2019. 
5 Section 3A omitted by Finance Act, 2011 providing that in case of imports, this shall be deemed to have   
been made on June 20, 2011. Earlier it was inserted by Finance Act, 2007. 
6 Sub section (1) substituted by Finance Act, 2006. 
7 Substituted vide Finance Act, 2007. 
The Federal Excise Act, 2005 
 
15 
 1[(2) Duty due for the dutiable supplies made or services rendered 
during a month shall be deposited by the registered person in the 
designated branch of the bank 2[by the date as prescribed in this respect]: 
Provided that the Board may, by notif ication in the official Gazette, 
prescribe any other manner of depositing the duty.] 
3[(3)***]. 
 4(4) A registered person may, subject to approval of the 5[Commissioner 
Inland Revenue] of Federal Excise having jurisdiction, file a revised return within 
6[one hundred and twenty] days of the filing of return under sub-section (1), to 
correct any omission or wrong declaration made therein 4[:] 
  7[Provided that the approval under this sub -section shall not 
be required if revised return is filed within sixty da ys of filing of 
the original return and either the duty payable as per the revised 
return is more than the amount paid or the refund claimed therein 
is less than the amount as claimed, under the return sought to be 
revised.] 
 (5) The Board may, by notification in the official Gazette, require 
any person or class of persons for any goods or class of goods to furnish 
such summary or details of particulars pertaining to imports, purchases, 
utilization, consumption, production, sales or disposal of such goods during 
any month or months in such format and manner as may be specified and 
provisions of this subsection may be invoked mutatis mutandis in respect of 
services. 
 (6) The Board may by an order, specify the manner and procedure 
for filing of return for the  purpose of this Act or rules made there under 
                         
1 Substituted vide Finance Act, 2007.                                                    
2 Expression substituted through Finance Act, 2016. 
3 Sub-section (3) omitted through Finance Act, 2016. 
4 Substituted vide Finance Act, 2006.                                                    
5 Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Ame ndment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
6 Amended vide Finance Act, 2008.                                                    
7 For full stop a colon substituted and thereafter proviso inserted by Finance Act, 2021. 
The Federal Excise Act, 2005 
 
16 
and for payment of duty by electronic means. The Board may specify the 
manner and procedure for the submission, receipt and transmission of any 
information for the purpose of this Act or rules made there under  by 
electronic means. 
 (7) Every amount of duty due from any person on any other 
account shall also be deposited on the prescribed 1[return] in the bank branch 
designated and in the same manner as aforesaid. 
 2[(8) The Board may, by rules made under this Act, prescribe a 
composite return.] 
 5.  Zero rate of duty and drawback of duty etc. —(1) 
Notwithstanding the provisions of section 3, the goods exported out of 
Pakistan or such goods as may be, by a notification in the official Gazette, 
specified by the Federal Government shall be charged to duty at the rate of 
zero per cent and adjustment of duty in terms of section 6 shall be admissible 
on such goods. 
 (2) The Board may, by notification in the official Gazette, grant 
drawback of duty paid on any goods used in the manufacture of any goods 
manufactured in and exported out of Pakistan, or shipped as provisions or 
stores for consumption on board a ship or aircraft proceeding to a 
destination outside Pakistan, at such rate or rates and subject to such 
conditions and limitations as may be specified in the notification. 
 3[(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 exportati on of goods or 
any specified goods or class of goods to any specified foreign port or 
territory.] 
 6. Adjustment of duties of excise.— (1) For the purpose of 
determining net liability of duty in respect of any goods, the duty already  
paid on  goods specified in the First Schedule and used directly as input 
goods for the  manufacture or production of such goods shall be deducted 
from the amount of duty calculated on such goods. 
 (2) Adjustment of duty of excise under sub -section (1) shall be 
                         
1 Substituted for “challan” by Finance Act, 2007. 
2 Added vide Finance Act, 2008.                                                    
3 Added vide Finance Act, 2007.                                                    
The Federal Excise Act, 2005 
 
17 
admissible only if a person registered under this Act holds a valid proof to 
the effect that he has paid the price of goods purchased by him including the 
amount of duty and received the price of goods sold by him including the 
amount of duty through banking channels including online payment whether 
through credit card or otherwise. 
 1[(2A) From the date to be notified by the Board, adjustment of duty 
of excise under sub -section (1) shall be admissible only if the 
supplier of input goods and services has declared such supply  
in his return and he has paid amount of tax due as indicated in 
his return]. 
 2[(2AB) Notwithstanding anything contained in this Act or the rules 
made thereunder, the Board may, by notification in the 
official Gazette, may impose restrictions on wastage o f 
material on which input tax has been claimed in respect of the 
goods or class of goods.] 
 (3) Notwithstanding the provisions of sub -section (1), the Board 
may, by a notification in the official Gazette, disallow or restrict whole or part 
of the amount of or otherwise regulate the adjustment of duty in respect of 
any goods or class of goods. 
 
 7.  Application of the provisions of the Sales Tax Act, 1990.— 
 3[(1)] In case of goods specified in the Second Schedule or such 
services as may be  specified by the Board through a notification in the 
official Gazette 4[the duty shall be payable in sales tax mode, whereby],— 
 (a) a registered person manufacturing or producing such goods or 
providing or rendering such services shall be entitled to deduct 
input tax paid during the tax period from the amount of duty of 
excise due from him on such goods or services in respect of that 
tax period; 
 (b) a registered person shall be entitled to deduct the amount of duty 
of excise paid or payable by him on such goods or services as are 
                         
1 New sub-section added through Finance Act, 2016. 
2    New sub-section inserted by Finance Act, 2020. 
3 Section 7 renumbered as sub-section (1) by Finance Act, 2008. 
4 Words and commas inserted by Finance Act, 2007. 
The Federal Excise Act, 2005 
 
18 
acquired by him during a tax period from the output tax due from 
him in respect of that tax period; 
 (c) a registered person supplying such goods or providing or 
rendering such services shall be entitled to deduct duty of excise 
paid or payable on such goods or services as are acquired by him 
during the tax period from the amount of duty of excise due from 
him on such goods manufactured or produced or services as are 
provided or rendered by him during that period; and  
 (d) a person shall be entitled to deduct duty of excise paid or payable, 
on such goods or services as are acquired by him during a month, 
from the amount of duty of excise due from him on such goods 
manufactured or produced or services as are provided or rendered 
by him, during that month. Such services as a re provided or 
rendered by him, during that month. 
Explanation.— For the purposes of this section, the expressions 
“input tax”, “output tax” and “tax period” shall have the same meanings as 
are assigned to them in the Sales Tax Act, 1990 1[*** ]. 
 2[(2) The 3[Board, with the approval of the Federal Minister -in-
charge,] may, by notification in the official Gazette, declare that any of the 
provisions of the Sales Tax Act,1990, relating to the levy of and 
exemption from sales tax, regi stration, book keeping and invoicing 
requirements, returns, offences  and penalties, appeals and recovery of 
arrears shall, with  such modifications and alterations as it may consider  
necessary or desirable to adapt them to the circumstances, be  applicable in 
regard to like matters in respect of the duty leviable under this Act.] 
 4[8. Default surcharge.—If a person does not pay the duty due or  
any part thereof within the prescribed time or receives a refund of duty or 
drawback or makes an adjustment which is not admissible to him, he shall, 
in addition to the duty due, pay default surcharge at the rate of 5[twelve 
percent per annum or KIBOR plus three percent per annum, whichever is 
higher], of the duty due, refund of duty or drawback. 
Explanation.—For the purpose of this section,– 
                         
1  Omitted vide Finance Act, 2007.                                                   
2 Inserted vide Finance Act, 2008.                                                    
3 The words “Federal Government” substituted through Finance Act, 2019. 
4  Inserted vide Finance Act, 2008. 
5  Words substituted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
19 
 (a) the period of default shall be reckoned from the date following 
the due date on which the duty was payable to the preceding day on which 
the duty is actually paid; and  
 (b) in case of inadmissible adjustment or refund of duty or 
drawback, the period of default shall be reckoned from the date of such 
adjustment or as the case may be, refund of duty or drawback is received.]                        
 9. Liability for payment of duty in the case of private 
companies or business ente rprises or in case of sale of business 
ownership.—(1) Notwithstanding anything contained in any other  law for 
the time being in force, where any private company or business enterprise is 
closed or discontinued or otherwise ceases to exist and any amount of duty 
chargeable on the company or business enterprise, whether before, or in the 
course of, or after its liquidation  cannot be recovered from the company or 
business enterprise, every person who  was a owner of, or partner in, or 
director of, the company or business enterprise shall, jointly and severally 
with such persons, be liable for the payment of such duty. 
 (2) In the case of sale or transfer of ownership of a business or 
part thereof involving any charge of duty to another person as an ongoing 
concern, the chargeable duty shall be paid by the person to whom such sale 
is made or  ownership is transferred provided that if any amount of duty 
payable by such person remains unpaid, such unpaid amount of duty shall 
be the first charge on  the assets of the business and shall be payable by the 
transferee of business: 
Provided that no business enterprise or a part thereof shall be sold 
or transferred unless the outstanding duty is paid and a no objection 
certificate in this behalf from the 1[Commissioner] concerned is obtained. 
 (3) In case of termination of a business or part thereof involving 
any outstanding charge of duty, a person terminating such business or part 
thereof shall be required to account for and pay the outstanding charge of 
duty as if no such termination has taken place. 
 10. Applicable value and rate of duty. — The value and the rate 
of duty applicable to any goods or services shall be the value, retail price, 
tariff value and the rate of duty in force,–. 
 (a) in the case of goods, on the date on which the goods are 
                         
1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. 
The Federal Excise Act, 2005 
 
20 
1[supplies] for export or for home consumption; 
 (b) in the case of services, on the date on which the services are 
provided or rendered; and 
 (c) in the case of goods produced or manufactured outside the areas 
to which this Act has been applied and brought to such areas for 
sale or consumption therein, the date on which the goods are 
brought to those areas. 
 11. Collection of excess duty etc. – Every person who for any 
reason whatever has collected or collects any duty, which is not payable as 
duty or which is in excess of the duty actually payable and the incidence of 
which has been passed on to the consumer, shall pay the amount so 
collected to the Federal Government and all the provisions of this Act or 
rules made there under shall apply for the recovery of such amount and 
claim for refund of any such amount paid or recovered shall not be 
admissible on any ground whatever. 
 12. Determination of value for the purposes of duty. – 2[(1) 
Where any goods are liable to duty under this Act a t a rate  dependent on 
their value, duty shall be assessed and paid on the  basis of value as 
determined in accordance with sub -section (46)of section 2 of the Sales 
Tax Act, 1990, excluding the amount of duty payable thereon. ] 
 (2) Where any services are l iable to duty under this Act at a rate 
dependent on the charges therefore, the duty shall be paid on total amount 
of charges for the services including the ancillary facilities or utilities, if 
any, irrespective whether such services have been rendered or provided on 
payment of charge or free of charge or on any concessional basis. 
 (3) Where any goods are chargeable to duty at the import stage, 
duty will be assessed and paid on the value determined in accordance with 
section 25 of the Customs Act, 1969 (IV of 1969), including customs duties 
payable thereon. 
 (4) Where any goods are chargeable to a duty on the basis of retail 
price, duty thereon shall be paid on the retail price fixed by the manufacturer, 
inclusive of all 3[duties,] charges and taxes, other than sales tax levied and 
                         
1 Substituted for “cleared” by Finance Act, 2007. 
2 Substituted vide Finance Act, 2008 
3 Words and comma inserted by Finance Act, 2007. 
The Federal Excise Act, 2005 
 
21 
collected under section 3 of the Sales Tax Act, 1990, at which any particular 
brand or variety of such goods should be sold to the general body of 
consumers or, if more than one such price is so fixed for the same brand or 
variety, the highest of such price and such retail price shall, unless otherwise 
directed by the Board, be legibly, prominently and indelibly indicated on each 
good, packet, container, package, cover or label of such goods: 
Provided that where so and as specified by the Board, any goods or 
class of goods liable to duty on local production as percentage of retail 
price, the provisions of this sub-section shall mutatis mutandis apply in case 
such goods are imported from abroad 1[:] 
2[Provided further that the Board  may through a general order 
specify zones or areas only for the purpose of determination of highest 
retail price for any brand or variety of goods.] 
 (5) The Board may fix the minimum price of any goods or class 
of goods, for the purpose of levying and co llecting of duty and duty on 
such goods shall be paid accordingly. 
 3[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 levi ed and collected at such 
higher price.] 
 13. Registration.— (1) Any person engaged in the production  or 
manufacture of goods or providing or rendering services liable to duty of 
excise under this Act shall, unless otherwise specified, be required to obtain 
registration in the prescribed manner regardless of his annual turnover or 
volume of sales of such goods or services. 
 (2) Where a person who is already registered under the Sales Tax 
Act, 1990, shall not be required to take separate registration for exci se 
purpose and his sales tax registration shall be deemed to be a registration for 
the purpose of this Act: 
Provided that provisions of the Sales Tax Act, 1990, including those 
relating to exemption threshold shall not apply where a person obtains or is 
liable to obtain registration for the purposes of this Act but does not have or is 
                         
1 Colon substituted vide Finance Act, 2014. 
2 Proviso inserted vide Finance Act, 2014. 
3 Added vide Finance Act, 2006.                                                  
The Federal Excise Act, 2005 
 
22 
not liable to registration under the Sales Tax Act, 1990. 
 14. Recovery of unpaid duty or of erroneously refunded duty or 
arrears of duty, etc.—(1) Where any person has not levied or paid any duty 
or has short levied or short paid such duty or where any amount of duty has 
been refunded erroneously, such person shall be serviced with notice 
requiring him to show cause for payment of such duty provided that such 
notice shall be issued within 1[five] years from the relevant date. 
 (2) The 2[officer of Inland Revenue] , empowered in this behalf, 
shall after considering the objections of the person served with a notice to 
show cause under sub-section (1), determine the amount of duty payable by 
him and such person shall pay the amount so determined along with default 
surcharge and penalty as specified by such officer under the provisions of this 
Act 3[:] 
4[Provided that an order under this section shall be made within one 
hundred and twenty days of issuance of show cause notice or within such 
extended period as the Commissioner may, for reasons to be recorded in 
writing, fix, provided that such extended period shall in no case exceed sixty 
days: 
Provided further that any period during w hich the proceedings are 
adjourned on account of a stay order or Alternative Dispute Resolution 
proceedings or the time taken through adjournment by the petitioner not 
exceeding thirty days shall be excluded from the computation of the 
periods specified in the first proviso.] 
 (3) Where any amount of duty levied and penalty imposed or any 
other amount payable under this Act is due from any person, such amount or 
sum shall be recovered in such manner as is prescribed under this Act or 
rules made there under.  
5[(4) The provision of sub-section (2) shall mutatis mutandis apply 
                         
1 Substituted for three by Finance Act, 2011. 
2 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Par t I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dat ed October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
3 Substituted for full stop by Finance Act, 2011. 
4 Proviso inserted by Finance Act, 2011. 
5    New sub-section (4) inserted by Finance Act, 2021. 
The Federal Excise Act, 2005 
 
23 
regarding assistance in collection and recovery of duties in pursuance of a 
request from a foreign jurisdiction under a tax treaty, a multilateral 
convention, and inter -governmental agreement or similar agreement or 
mechanism as the case may be.] 
 
 (4) Notwithstanding anything contained under any other law for the 
time being in force, where any business or activity involving liability to 
charge, levy and pay duty under this Act is sold, discontinued or liquidated, 
the amount of unpaid or recoverable duty shall be the first charge on the 
assets of the business. 
Explanation.—For the purpose of this section,  1[refund includes 
drawback of duty and]  the expression “relevant date” means the dat e on 
which the payment of duty was due under sub -section (3) and in case 
where any amount of duty has been erroneously refunded, the date of its 
refund. 
 
 2[14A. Short paid amounts recoverable. –Notwithstanding the 
provisions of this Act or the rules made there under , here a registered 
person pays the amount of duty less than the duty due  as indicated in his 
return, the short paid amount of duty 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 prejudice to any other action under this  Act or the rules made 
there under: 
Provided that no penalty under this Act or rules made there under 
shall be imposed unless a show cause notice is given to such person.] 
 3[14B. Assessment giving effect to an order. –. (1) Except where 
sub-section (2) applies, where, in consequence of, or to give effect to, any 
finding or direction in any order made under Chapter -V by the 
Commissioner (Appeals),  Appellate Tribunal, High Court, or Supreme 
Court, the Commissioner or an officer of Inland Revenue empowered in 
this behalf, shall issue the order within one year from the end of the 
financial year in which the order of the Commissioner (Appeals), 
Appellate Tribunal, High Court or Supreme Court, as the case may be, 
                         
1 Added vide Finance Act, 2008. 
2 Inserted by Finance Act, 2007. 
3     New section 14B inserted by Finance Act, 2018.  
The Federal Excise Act, 2005 
 
24 
was served on the Commissioner or Officer of Inland Revenue. 
 (2) Where, by an order made under Chapter V by the Appellate 
Tribunal, High Court, or Supreme Court, an order of assessment is 
remanded wholly or partly, and the Commissioner or Commissioner 
(Appeals) or the Officer of Inland Revenue, as the case may be, is directed 
to pass a new order of assessment, the Commissioner or Commissioner 
(Appeals) or Officer of Inland Revenue, as the case m ay be, shall pass the 
new order within one year from the end of the financial year in which the 
Commissioner or Commissioner (Appeals) or Officer of Inland Revenue, 
as the case may be, is served with the order: 
Provided that limitation under this sub -section shall not apply if an 
appeal or reference has been preferred against the order passed by 
Appellate Tribunal or a High Court.] 
 
1[14C. Power of tax authorities to modify orders, etc. –. (1) 
Where a question of law has been decided by a High Court or the 
Appellate Tribunal in the case of a registered person, on or after first day 
of July 2005, the Commissioner or an officer of Inland Revenue may, 
notwithstanding that he has preferred an appeal against the decision of the 
High Court or made an application fo r reference against the order of the 
Appellate Tribunal, as the case may be, follow the said decision in the 
case of the said taxpayer in so far as it applies to said question of law 
arising in any assessment pending before the Commissioner or an officer 
of Inland Revenue, until the decision of the High Court or of the Appellate 
Tribunal is reversed or modified.  
(2)  In case the decision of High Court or the Appellate 
Tribunal, referred to in sub -section (1), is reversed or modified, the 
Commissioner or an  officer of Inland Revenue may, notwithstanding the 
expiry of period of limitation prescribed for making any assessment or 
order, within a period of one year from the date of receipt of decision, 
modify the assessment or order in which the said decision wa s applied so 
that it conforms to the final decision.] 
15. Application of the Customs Act, 1969 (IV of 1969) to 
Federal excise duties.—The Federal Government may, by notification in 
the official Gazette, declare that any or all of the provisions of the Customs 
                         
1 New section 14C inserted by Finance Act, 2020. 
The Federal Excise Act, 2005 
 
25 
Act, 1969 (IV of 1969), shall, with such modifications and alterations it 
may specify, consider necessary or desirable to adapt them to the 
circumstances, be applicable in regard to like matters in respect of the duties 
levied by sections 3 and 8. 
 16. Exemptions.—(1) All goods imported, produced or 
manufactured in Pakistan and services provided or rendered except such 
goods and services as are specified in the First Schedule shall be exempt 
from whole of excise duties 1[levied under section 3]: 
 Provided that goods and services specified in the Third Schedule 
shall be exempt from duty subject to such conditions and restrictions, if any, 
specified therein and no adjustment in terms of section 6 shall be admissible 
in respect of goods exempt from duty of excise whether conditionally or 
otherwise. 
 
 2[(2) The Federal Government may, whenever circumstances exist 
to take immediate action for the purposes of national security, natural 
disaster, national food security in emergency situations and 
implementation of bilateral and multilateral agreements, by notification in 
the official Gazette, exempt subject to such conditions as may be specified 
therein, any goods or class of goods or any services or class of services 
from the whole or any part of the duty leviable under this Act.] 
3[(3)  * * *] 
 (4) Notwithstanding the provisions of 4[sub-section (2) ], the 
Federal Government or the Board may, by a notification in the official 
Gazette, for reasons to be recorded, exempt any person or class of persons 
from payment of the whole or part of the default surcharge imposed under 
section 8 5[and penalties] subject to the such conditions or limitations as 
may be specified in such notification. 
 6[(5) The 7[Board] shall place before the National Assembly all 
notifications issued under this section in a financial year. 
                         
1 Added vide Finance Act, 2007. 
2 Sub-section (2) substituted by Finance Act, 2019. 
3 Sub-section (3) omitted by Finance Act, 2015 
4 Substituted for the words, figures and brackets “sub-sections (2) and (3)” by Finance Act, 2015 
5 Inserted vide Finance Act, 2007. 
6 Sub-sections (5) and (6) inserted by Finance Act, 2015  
7 Substituted for the words “Federal Government” by Finance Act, 2017 
The Federal Excise Act, 2005 
 
26 
 (6) Any notification issued under sub -section (2) after 1 st July, 
2015, shall, if not earlier rescinded, stand rescinded on the expiry of the 
financial year in which it was issued 1[: 
Provided that all such not ifications, except those earlier rescinded, 
shall be deemed to have been in force with effect from the 1 st July, 2016 
and shall continue to be in force till the 30 th June, 2018, if not earlier 
rescinded: 
Provided further that all notifications issued on or  after the first 
day of July, 2016 and placed before the National Assembly as required 
under sub-section (5) shall continue to be in force till thirtieth day of June, 
2018, if not earlier rescinded by the Federal Government or the National 
Assembly.] 
 17. Records.—(1) Every person registered for the purposes of  this 
Act shall maintain and keep for a period of 2[six] years  3[or till such 
further period the final decision in any proceedings including proceedings 
for assessment, appeal, revision, reference, pe tition and any, proceedings 
before an Alternative Dispute Resolution Committee is finalized]  at his 
business premises or registered office in English or Urdu language the 
following records of excisable goods purchased, manufactured and cleared 
(including those cleared without payment of excise duty) by him or by his 
agent acting on his behalf in such form and manner as would permit ready 
ascertainment of his liability of duty, namely:— 
 (a) records of clearances and sales made indicating the 
description, quantity and value of goods, name and address of 
the person to whom sales were made and the amount of the 
duty charged; 
                         
1 Provisos added by Finance Act, 2017 
2 Substituted for “Five” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
3 Words and commas inserted by Finance Act, 2010 w.e.f. June 5, 2010. The same amend ment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed o n 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
27 
 (b) records of goods purchased showing the description, quantity and 
value of goods, name, address and registration number of the 
supplier and the amount of the duty, if any, on purchases; 
 (c) records of goods cleared and sold without payment of duty; 
 (d) records of invoices, bills, accounts,  agreements, contracts, 
orders and other allied business matters; 
 1[(da) record relating to gate passes, inward or outward, and 
transport receipts;] 
 (e) records of production, stocks and inventory; 
 (f) records of imports and exports; and 
 (g) such other records as may be specified by the Board. 
 (2) For any person or class of persons registered under this Act, or 
for any goods or class of goods the Board may specify or prescribe,— 
 (a) to keep any other records for the purposes of this Act; 
 (b) to use such electronic fiscal cash registers as may be approved 
by the Board; and 
 (c) the procedure or software for electronic maintenance of records 
and filing of statements, documents or information by any 
person or class of persons. 
 (3) Provisions of sub -sections (1) and (2) shall apply mutatis 
mutandis on services provided or rendered by a person registered under this 
Act. 
 18. Invoices.—(1) A person registered under this Act shall issue 
for each transaction a serially numbered invoice at the time of clearance or 
sale of goods, including goods chargeable to duty at the rate of zero per cent, 
or providing  or rendering services containing the following particulars, 
namely:– 
                         
1 Clause (da) inserted by Finance Act, 2013. 
The Federal Excise Act, 2005 
 
28 
 a. name, address and registration number of the seller; 
 b. name, address and registration number of the buyer; 
 c. date of issue of the invoice; 
 d. description and quantity of goods or  as the case may be, 
description of services; 
 e. value exclusive of excise duty; 
 f. amount of excise duty; and 
 g. value inclusive of excise duty. 
 (2) Notwithstanding sub-section (1), where a registered person is 
also engaged in making supplies taxable under the Sales Tax Act, 1990, 
such person shall not be required to issue a separate invoice for excise 
purposes and the amount of excise duty and other related information may 
in such cases be mentioned on the invoice issued for sales tax purposes. 
 (3) The Board may, by notification in the official Gazette, specify 
such modified invoices for different persons or classes of persons as it may 
deem necessary. 
 (4) The Board may, by notification in the official Gazette, specify 
goods in respect of which a cop y of the invoice shall be carried or 
accompanied with the conveyance during their transportation or movement 
in such manner and subject to such conditions as may be specified in this 
behalf either in such notification or otherwise. 
 1[(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.] 
 
 
                         
1  Added vide Finance Act, 2006 
The Federal Excise Act, 2005 
 
29 
CHAPTER III 
OFFENCES AND PENALTIES 
 19. Offences, penalties, fines and al lied matters. —(1)  Any 
person who fails to file or files an incorrect return within the period specified 
in sub-section (1) of section 4 or fails to make payment or makes short 
payment of duty on any  account, shall pay a penalty of  1[five thousand 
rupees in case of non -filing of return  and ten thousand rupees or five per 
cent of the du ty involved whichever is higher  in case of short payment of 
duty due] in addition to the amount due from him and without prejudice to 
other liabilities which may be determined against him or action which may 
be taken against him under this Act and rules made there under ;  
2[Provided that where a person files the return within  fifteen days 
after the due date he shall pay a penalty of one  hundred rupees for each 
day of default”; and] 
 (2) Any person who,–– 
 (a) makes, orally or in writing, or signs any declaration, 
certificate or other document required by this Act or rules 
made there under or by any Federal Excise officer to do so, 
which is untrue or incorrect in any particular  or which is 
incomplete by omitting any material particular there 
from; 
 (b) counterfeits or falsifies, or uses, when counterfeited or 
falsified, any document which is or may be required 
under this Act or rules made there under or any document 
used in the transaction of any business or matter relevant 
to this Act or rules made there under; 3[omitted] 
 (c) fails or refuses to give or produce to the 4[officer of 
                         
1 Substituted vide Finance Act, 2008. 
2  Added vide Finance Act, 2008. 
3  The word “and” omitted by Finance Act, 2019. 
4  Substituted for “Federal Excise Officer”  by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance 
(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of 
Pakistan Extraordinary Part I at pages 23 to 53. Th is Ordinance was presented in the Parliament but lapsed on 5 June 2010 as 
Parliament did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
30 
Inland Revenue]  any information or document required 
to be given or produced under this Act or rules made there 
under; 1[and] 
 2[(d) a person who sells cigarettes in retail at a price lower 
than the retail price plus the amount of sales tax as 
printed thereon,] 
shall be guilty of an offence and for every such offence shall be liable to fine 
which may extend to twenty thousand rupees and in case of offence under 
clause (b), the fine may extend to one hundred thousand rupees and he shall 
be punishable with imprisonment for a term which may extend to five years 
or with both. 
 (3) Any person who,— 
 (a) illegally removes, stores, keeps, or withdraws or in any way 
assists or is concerned in the illegal removal or withdrawal of 
any goods in the manner other than the manner prescribed 
under this Act or rules made there under; 
 (b) is in any way concerned in conveying, removing, depositing or 
dealing with any goods with intent to defraud the Government 
of any duty of excise due thereon, or to violate any of the 
provisions of this Act or rules made there under;  
 (c) is in any way concerned in any fraudulent evasion or attempt at 
fraudulent evasion of any duty of excise; 
 (d) claims, takes or avails adjustment of duty not admissible 
under this Act or the rules made there under; 3[***] 
 (e) is in any way concerned in the manufacture of any dutiable 
goods in contraven tion of the provisions of this Act or rules 
made there under; 4[and] 
                         
1 The word “and” inserted by Finance Act, 2019. 
2  New clause (d) inserted through Finance Act, 2019. 
3    Word and omitted by Finance Act, 2024. 
4    Word and inserted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
31 
 1[(f) where the value of the plant and machinery is rupees fifty 
million and above, installs such plant and machinery, 
commences production or removes such plant and machinery 
without prior permission of the Commissioner; 
shall be guilty of an offence and for each such offence, shall be liable to fine 
which may extend to fifty thousand rupees or five times of the duty involved, 
whichever is higher and to punishment with imprisonment which  may 
extend to five years or both. 
 (4) Any person who, without the approval of the 2[Commissioner], 
directly or otherwise destroys, damages, erases or otherwise manipulates 
data stored in or used in connection with a computer or otherwise uses a 
computer, the purpose or effect of which is to reduce, avoid or evade any 
liability to duty of excise which would otherwise have been imposed by this 
Act, or to defeat any provisions of this Act or rules made there under shall be 
guilty of an offence and shall be liable to fine which may extend to seventy 
five thousand rupees or ten times of the duty involved, whichever is higher 
and to punishment with imprisonment which may extend to five years or 
both. 
(5) If any person obtains, attempts to obtain or abets in obtainin g, 
or does anything whereby there might be obtained by another person, any 
amount by way of refund or drawback of any duty in respect of any goods  
3[or services] not lawfully payable or allowable in respect thereof or which 
is greater than the amount so payable or allowable, he shall be guilty of an 
offence and shall be liable to fine which may extend to one hundred 
thousand rupees or five times of duty involved, whichever is higher and to 
punishment with imprisonment which may extend to five years or both. 
(6) Any person who obstructs any 4[officer of Inland Revenue] or 
                         
1    New clause (f) inserted by Finance Act, 2024. 
2  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) 
Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary 
Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not appr ove it. 
Originally this amendment was made through Finance (Amendmen t) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, 
dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
3  Words inserted by Finance Act, 2008. 
4 Substituted for “Federal Excise Officer” by Finan ce Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance 
(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan 
Extraordinary Part I at pages 23 to 53. This Ordina nce was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not 
approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII  
of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
The Federal Excise Act, 2005 
 
32 
other public servant or any person acting in his aid or assistance, or duly 
employed for the prevention of offences under this Act or rules made there 
under in the execution of his duty or in the due seizing of any goods liable to 
seizure under this Act or rules made there under, shall be guilty of an offence 
and for each such offence, shall be liable to fine which may extend to fifty 
thousand rupees or five times of duty involved, whichever is higher and to 
punishment which may extend to three years or both. 
(7) Where an offence under this Act or rules made there under has 
been committed by a company, firm, or other body of persons, any person 
who at the time of the commission of the offence was a di rector, manager, 
or other similar officer or a partner of the company, firm, or other body of 
persons or was purporting to act in that capacity shall be deemed to be 
guilty of that offence unless he proves that the offence was committed 
without his consent or connivance and that he exercised all such diligence to 
prevent the commission of the offence as he ought to have exercised, 
having regard to the nature of his functions in that capacity and to all the 
circumstances. 
(8) Unless otherwise legally proved, whe re any person is liable 
under this Act to any penalty or punishment for any act, omission, neglect or 
default, he shall be liable to the same punishment, penalty or forfeiture for 
every such act, omission, neglect or default of any agent or employee. 
(9) Where any goods are chargeable to duty on the basis of retail 
price under this Act and the retail price is not indicated on the goods  1[and 
in case of cigarettes, retail price, health warning and name of the 
manufacturer is not mentioned ] in the manner specified therein or in the 
rules made there under, the duty shall be charged at the rate of 500 per cent 
ad valorem in case of cigarettes, and 40 per cent ad valorem in case of 
goods other than cigarettes: 
 
Provided that in cases where a registered person doe s not intend to 
print   retail price for any genuine reasons, he may voluntarily pay duty on the 
said higher rates as applicable to him and declare his duty payments in the 
return accordingly and other provisions of this section shall not apply in such 
cases. 
 
                         
1  Added vide Finance Act, 2009. 
The Federal Excise Act, 2005 
 
33 
(10) 1[Where any person is engaged in the manufacture or 
production of cigarettes 2[or un-manufactured tobacco] in the manner contrary 
to this Act or the rules made thereunder or otherwise evades duty of excise on 
cigarettes 3[or un-manufactured tobacco] or is engaged in the manufacture or 
production of counterfeited cigarettes or tax stamps, banderoles, stickers, labels 
or barcodes, or is engaged in the manufacturing or production of cigarettes 
packs without affixing, or affixing counterfeited, tax stamps,  banderoles, 
stickers, labels or barcodes, the machinery, equipments, instruments or devices 
used in such manufacture or production shall, after outright confiscation, be 
destroyed in such manner as may be approved by the Commissioner and such 
person shall not be entitled to any claim on any ground whatsoever, or be 
otherwise not entitled to any compensation in respect of such machinery or 
equipments, instruments or devices and such confiscation or destruction shall 
be without prejudice to any other penal action which may be taken under the 
law against the person or in respect of the cigarettes  1[or un-manufactured 
tobacco], tax stamps, stickers, labels, barcodes or vehicles involved in or 
otherwise linked or connected with the case.] 
 
 4[(10A) If any retailer is found selling cigarettes packs without affixing, 
or affixing counterfeited, tax stamps, banderoles, stickers, labels or barcodes, 
notwithstanding any other provision of this Act, the retail outlet of such person 
shall be liable to be sealed in the manner as may be prescribed.] 
(11) Any goods in respect of which any of the provisions of this 
Act or rules made or notifications issued there under has been contravened 
shall be liable to confiscation along with the conveyance, if any, in which 
such goods are laden or have been or being carried and all confiscations in 
this regard shall vest with the Federal Government. 
(12) Any person who attempts to commit any offence punishable 
under this Act, or abets the commission of the offence, shall be liable to the 
punishment provided for the offence. 
(13) 5[Any person who contravenes any provision of this Act or 
rules made thereunder for which no penalty has specifically been provided 
                         
1  Sub-section (10) substituted by Finance Act, 2017 
2  Words inserted by Finance Supplementary (Amendment) Act, 2018 
3  Words inserted by Finance Supplementary (Amendment) Act, 2018 
4 New sub-section (10A) inserted through Finance Act, 2024. 
5 New sub-section (13) inserted through Finance Act, 2016. 
The Federal Excise Act, 2005 
 
34 
in this section shall be liable to pay a penalty of five thousand rupees or 
three percent of the amount of duty involved, whichever is higher]. 
 
 1[19A. ***] 
 20. Appointment of Special Judges for trial of offences. – (1) 
The Federal Government may, by notification in the official Gazette, 
appoint as many Special Judges as it may consider necessary, and, where it 
appoints more than  one Special Judge, shall specify in the notification the 
territorial limits within which each one of them shall exercise jurisdiction. 
(2)  A Special Judge shall be a person who is or has been or is 
qualified to be a Sessions Judge. 
 21. Trial of offences by Special Judge. — (1) On the appointment 
of a Special Judge for any area, an offence punishable under this Act shall be 
tried exclusively by the Special Judge and all cases pending in any other  
court in such area immediate ly before such appointment shall stand 
transferred to such Special Judge. 
 (2) The provisions of the Code of Criminal Procedure, 1898 (Act 
V of 1898), except those of Chapter XXXVIII of that Code, shall apply to 
the proceedings of the court of a Special Judge and, for the purposes of the 
said provisions, the court of a Special Judge shall be deemed to be a Court of 
Session trying cases, and a person conducting prosecution before the court 
of a Special Judge shall be deemed to be a Public Prosecutor. 
 (3) For the purposes of sub -section (2), the Code of Criminal 
Procedure, 1898 (Act V of 1898), shall have effect as if an offence 
punishable   under this Act were one of the offences referred to in sub -
section (1) of section 337 of the Code. 
 (4) A Special Judge shall take cognizance of, and have jurisdiction 
to try an offence tribal under sub -section (1) only upon a complaint in 
writing made by such 2[officer of Inland Revenue] as may be authorized by 
                         
1 Section 19A omitted through Finance Act, 2022. 
2 Substituted for “Federal Excise Officer” by Finance Act, 2010  w.e.f. June 5, 2010. The same amendment was made by Finance 
(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pa kistan 
Extraordinary Part I at pages 23 to 53. This Ordinance was pres ented in the Parliament but lapsed on 5 June 2010 as Parliament did not 
approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 
2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
The Federal Excise Act, 2005 
 
35 
the Board in this behalf, by a general or special order in writing. 
 (5) The provisions of Chapter XX of the Code of Criminal 
Procedure, 1898 (Act V of 1898), shall apply to trial of cases under this Act 
in so far as they are not inconsistent with the provisions of this Act. 
 (6) The Federal Government may, by order  in writing, direct the 
transfer, at any stage of the trial, of any case from the court of one Special 
Judge to the court of another Special Judge for disposal, whenever it 
appears to the Federal Government that such transfer will promote the ends 
of justice or tend to the general convenience of parties or witnesses. 
 
 (7) In respect of a case transferred to a Special Judge by virtue of 
sub-section (1) or under sub-section (6), such Judge shall not, by reason of 
the said transfer, be bound to recall and reh ear any witness who has given 
evidence in the case before the transfer and may act on the evidence already 
recorded by or produced before the court which tried the case before the 
transfer. 
 1[21A. Appeal against the order of Special Judge.– An appeal against 
the order of a special Judge in respect of the trial of offence s hall lie to the 
respective High Court of the Province within thirty days of the passing of the 
order and it shall be heard as an appeal under the Code of Criminal Procedure 
1898 (Act V of 1898) by a single judge of High Court.] 
 22. Power to arrest and prosecute. – (1) Any 2[officer of Inland 
Revenue] authorized by the Board in this behalf who has reason to believe 
that any person has committed an offence under this Act may arrest such 
person after obtaining permission in writing from the 3[Commissioner] 
                         
1  Section 21A inserted by Finance Act, 2010 w.e.f. June 5, 2010. 
2  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 
2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not a pprove it. Originally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII 
of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
3  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 2 3 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
36 
concerned: 
Provided that the 1[officer of Inland Revenue]  shall immediately 
intimate the fact of the arrest of a person to the Special Judge who may 
direct such Officer to produce that perso n at such time and place and on 
such date as the Special Judge considers expedient and such Officer shall act 
accordingly. 
 (2) Notwithstanding anything contained in proviso to sub -section 
(1), any person arrested under this Act shall be produced before the Special 
Judge or, if there is no Special Judge within a reasonable distance, to the 
nearest Judicial Magistrate, within twenty -four hours of such arrest, 
excluding the time necessary for the journey from the place of arrest to the 
Court of the Special Judge or, as the case may be, of such Magistrate. 
 (3) When any person is produced under sub-section (2) before the 
Special Judge, he may, on the request of such person, after perusing the 
record, if any, and after giving the prosecution an opportunity of be ing 
heard, admit him to bail on his executing a bond, with or without sureties, or 
refuse to admit him to bail and direct his detention at such place as he 
deems fit: 
Provided that nothing herein contained shall preclude the Special 
Judge from canceling the bail of any such person at a subsequent stage if, 
for any reason, he considers such cancellation necessary, but before passing 
such order he shall afford such person an opportunity of being heard, unless 
for reasons to be recorded  he considers that the a ffording of such 
opportunity shall defeat the purposes of this Act. 
 (4) When such person is produced under sub -section (2) before a 
Judicial Magistrate, such Magistrate may, after authorizing his detention in 
such custody, at such place and for such perio d as he considers necessary 
or proper for facilitating his earliest production before the Special Judge, 
direct his production before the Special Judge on a date and time to be fixed 
by him or direct such person to be forthwith taken to, and produced before, 
the Special Judge and he shall be so taken. 
 (5) Nothing in sub -section (3) or sub -section (4) shall preclude 
                                                             
 
The Federal Excise Act, 2005 
 
37 
the Special Judge or the Magistrate from remanding any such person to the 
custody of the 1[officer of Inland Revenue]  holding inquiry against t hat 
person if such Officer makes a request in writing, to that effect and the 
Special Judge or the Judicial Magistrate, after perusing the record, if any, 
and hearing such person, is of the opinion that for the completion of inquiry 
or investigation it is necessary to make such an order, provided that in no 
case the period of such custody shall exceed fourteen days. 
   
 (6) When any person is arrested under this Act, the 1[officer of 
Inland Revenue] shall record the fact of arrest and other relevant particulars 
in the register mentioned in sub-section (10) and shall immediately proceed 
to inquire into the charge against such person and if he completes the 
inquiry within twenty-four hours of his arrest, excluding the time necessary 
for journey as aforesaid, h e may, after producing such person before the 
Special Judge or the nearest Judicial Magistrate make a request for his 
further detention in his custody. 
 
 (7) While holding an inquiry under sub-section (6), the 1[officer of 
Inland Revenue]  shall exercise th e same powers as are exercisable by an 
officer in charge of a police-station under the Code of Criminal Procedure, 
1898 (Act V of 1898), but such Officer shall exercise such powers subject 
to the foregoing provisions of this section while holding an inquir y under 
this Act. 
 
 (8) If a 1[officer of Inland Revenue], after holding an inquiry, is of 
the opinion that there is no sufficient evidence or reasonable grounds to 
proceed against a person he shall make a report to this effect to the 
2[Commissioner]  and with his approval may release him on his executing a 
bond with or without sureties and shall direct such person to appear, as and 
                         
1 Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as O rdinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendm ent was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
2  Substituted for “Collector” by Finance Act, 2010 w .e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
The Federal Excise Act, 2005 
 
38 
when required, before the Special Judge and may make a report to the 
Special Judge for the discharge of such person and shall make a full report 
of the case of his immediate superior. 
  
 (9) The Special Judge to whom a report has been made under 
subsection (8) may, after the perusal of record of the inquiry and hearing 
the prosecution, agree with such report and discharge the accused or, if he is 
of the opinion that there is sufficient ground for proceeding against such 
person, proceed with his trial and direct the prosecution to produce evidence. 
 
 (10) The 1[officer of Inland Revenue]  empowered to hold inquiry 
under this section shall maintain a register to be called "Register of Arrests 
and Detention" in the prescribed form in which he shall enter the name and 
other particulars of every person arrested under this Act, together with the 
time and date of arrest, the details of the information received, the details of 
things, goods or documents, recovered from his custody, the name of the 
witnesses and the explanation, if any, given by him and the manner in which 
the inquiry has been conducted from day to day, and such register or 
authenticated copies of its aforesaid entries shall be produced before the 
Special Judge whenever such Officer is so directed by him. 
 (11) After completing the inquiry, the 1[officer of Inland Revenue]  
shall, as early as possible, submit to the Special J udge a complaint in the 
same form and manner, in which the officer in charge of a police -station 
submits a report before a court. 
 (12) Any Magistrate of the first class may record any statement or 
confession during inquiry under this Act, in accordance wi th the 
provisions of section 164 of the Code of Criminal Procedure, 1898 (Act V of 
1898). 
 (13) Without prejudice to the foregoing provisions of this section, 
the 2[Board, with the approval of the Federal Minister -in-charge,] may, by 
                         
1  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amend ment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
2  The words “Federal Government” substituted through Finance Act, 2019. 
The Federal Excise Act, 2005 
 
39 
notification in the of ficial Gazette, authorize any other officer working 
under the Board to exercise the powers and perform the functions of a 
1[officer of Inland Revenue] under this section, subject to such conditions, if 
any, that it may deem fit to impose. 
 (14) Notwithstanding any provision of this Act, where any person 
has committed an offence liable to penalty or punishment under this Act, the 
1[Commissioner] may, either before or after the initiation of any proceedings 
for the recovery of duty or prosecution of such pers on, compound the 
offence if he pays the amount of duty along with such default surcharge 
and penalty as is determined under the provisions of this Act. 
 23. Power to summon persons to give evidence and produce 
documents in inquiries. – (1) Any 2[officer of Inland Revenue]  duly 
empowered by the Board in this behalf shall have power to summon any 
person whose attendance he considers necessary either to give evidence or 
to produce a document or any other thing or information in any inquiry 
which such officer is making for any of the purposes of this Act. 
 (2) All persons so summoned shall be bound to attend, either  in 
person or by an authorized agent, as such Officer may direct, and all 
persons so summoned shall be bound to state the truth upon any subject 
respecting which they are examined or make statements and to produce such 
documents and other things as may be required: 
Provided that the exemptions under sections 132 and 133 of the 
Code of Civil Procedure (V of 1908) shall be applicable to requisitions for 
attendance under this section. 
 (3) Every such inquiry as aforesaid shall be deemed to be a 
                         
1  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
 
2  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this am endment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
40 
"judicial proceeding" within the meaning of section 193 and section 228 of 
the Pakistan Penal Code (XLV of 1860). 
 24. Officers required to assist 1[officer of Inlan d Revenue] .– 
All officers of Police and Customs, sales tax, the civil armed forces and all 
officers of Government engaged in the collection of land -revenue, and all 
village officers shall assist the 1[officer of Inland Revenue] in the execution 
of this Act as and when required by such Officers. 
The Federal Excise Act, 2005 
 
41 
CHAPTER IV  
 
SEARCHES, ARRESTS AND SEIZURES 
 
 25. Searches and arrests how to be made. – All searches or 
arrests made under this Act or any rules made there under and all arrests 
made under this Act shall be carried out in accordance with the relevant 
provisions of the Code of Criminal Procedure, 1898 (V of 1898). 
 26. Power to seize. – 1[(1) The   counterfeited cigarettes or 
beverages whi ch have been manufactured or produced unlawfully and 
other dutiable goods on which duty of excise h as not been paid in the 
manner as required under this Act and the rules made thereunder 2[or such 
goods without affixing or affixing counterfeit tax stamps, bar codes, 
banderoles, stickers, labels or bar codes, as required under section 4 5A of 
this Act], shall be liable to seizure along with the conveyance, which has 
been used for the movement, carriage or transportation of such goods. 
 (2) For the purpose of this section, ‘conveyance’ shall include all 
of its fixtures, fittings and accessories etc.] 
 27. Confiscation 3[of goods subject to federal excise duty].– (1) 
The cigarettes 1[or beverages] seized for the reasons of counterfeiting 4[or 
such goods without affixing or affixing counterfeited tax stamps, 
banderoles, stickers, labels or b arcodes, as required under section 45A of 
this Act] shall be liable to outright confiscation and shall be  destroyed in 
the manner prescribed in sub-section (10) of section 19. 
 (2) In case of 5[dutiable goods ] seized on account of evasion of 
duty, the owne r shall be given an option to pay penalties and fines as 
provided under section 19 and meet other obligations as provided under 
other relevant provisions of the Act and rules made there under, for release 
                         
1 Sub-section (1) substituted by Finance Act, 2020. 
2 In section 26, in sub-section (1), after the word “thereunder”, the expression “or such goods without affixing 
or affixing counterfeit tax stamps, bar codes, banderoles, stickers, labels or bar codes, as required under 
section 45A of this Act inserted by Finance Act, 2025. 
3 Marginal note expression substituted by Finance Act, 2020. 
4 In section 2 7, in sub -section (1), after the word “counterfeiting”, the expression “or such goods without 
affixing or affixing counterfeit ed tax stamps,  banderoles, stick ers, labels or bar codes, as required under 
section 45A of this Act inserted by Finance Act, 2025. 
5 Expression substituted by Finance Act, 2020. 
The Federal Excise Act, 2005 
 
42 
of such 3[dutiable goods ] in lieu of confiscation provided that if such 
release is not claimed or availed, no reduction or abatement in respect of 
amounts of duty, penalties and fine shall be admissible in case such 
3[dutiable goods] are auctioned. 
 (3) In case confiscated cigarettes 1[ , un-manufactured tobacco] are 
rendered unfit for human consumption or become otherwise unfit for sale, 
the 1[Commissioner] may allow destruction of such cigarettes 1[ , un-
manufactured tobacco] in such manner as he may deem appropriate. 
 2[(4)  Without prejudice to the foregoing provisions of this section, the 
Board in case of goods subject to monitoring under section 45A of this Act and 
counterfeited goods, may authorize any officer of Revenue department not below 
the rank of Naib Tehsildar or Excise and Taxation Officer not below the rank of 
BPS-16 to exercise the powers and perform the functions of the Officer of Inland 
Revenue under section 26 and sub-section (1) of section 27, by notification in the 
official Gazette subject to such conditions, if any, it may deem fit to be imposed.] 
 28. Power to release seized conveyance. – (1) Where  any 
conveyance is seized which is liable to confiscation, the adjudicating 
authority may, subject to such conditions as may be prescribed, order its 
release pending adjudication of the case and on furnishing a guarantee by the 
owner of the seized  conveyance, from a scheduled bank valid for at least 
one year equal to the value of such conveyance. 
 (2) In respect of cases pending before the Special Judge, release of 
conveyance under sub -section (1) shall not be allowed without prior 
permission of the Special Judge. 
                         
1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliam ent did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2     Sub-section (4) inserted by Finance Act, 2025.    
The Federal Excise Act, 2005 
 
43 
CHAPTER V 
POWERS, ADJUDICATION AND APPEALS 
 29. Appointment of Federal excise officers and delegation of 
powers.—1[(1) For the purposes of this Act and rules made there under, the 
Board may, by notification in the official Gazette, appoint, in relation to 
any area or jurisdiction specified in the notification, any person to be – 
 
(a) Chief Commissioner Inland Revenue; 
(b) Commissioner Inland Revenue; 
(c) Commissioner Inland Revenue (Appeals); 
(d) Additional Commissioner Inland Revenue; 
(e) Deputy Commissioner Inland Revenue;  
2[(ea) District Taxation Officer Inland Revenue]; 
(f) Assistant Commissioner Inland Revenue; 
2[(fa) Assistant Director Audit Inland Revenue]; 
(g) Inland Revenue Officer; 
(h) Superintendent Inland Revenue; 
(i) Inspector Inland Revenue; 
(j) Inland revenue Audit Officer; and 
(k) Officer of Inland Revenue with any other designation.] 
  
 3[(1A) The Chief Commissioner Inland Revenue and Commissioner 
Inland Revenue (Appeals) shall be subordinate to the Board and 
Commissioner Inland Revenue shall be subordinate to the Chief 
Commissioner Inland Revenue. 
 
                         
1 Sub-section (1) substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
2  Clauses (ea) & (fa) added by Finance Act, 2017 
3 Section (1A), (1B) and (1C) inserted by Finance Act , 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance wa s 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in the Ga zette of Pakistan Extraordinary Part I at pages 
229 to 259 
The Federal Excise Act, 2005 
 
44 
 1[(1AA) The Chief Commissioners Inland Revenue shall perform their 
functions in respect of such persons or classes of persons or such areas as 
the Board may direct. 
 
 4(1AB) The Commissioners Inland Revenue shall perform their 
functions in respect of such persons or classes of persons or such areas as 
the Chief Commissioner, to whom they are sub-ordinate, may direct.] 
 
 (1B) Additional Commissioner Inland Revenue, Depu ty 
Commissioner Inland Revenue 2[, District Taxation Officer Inland 
Revenue], Assistant Commissioners Inland Revenue Officers 3[, Assistant 
Director Audit Inland Revenue], Inspector Inland Revenue and Officers of 
Inland Revenue with any other designation s hall be subordinate to the 
Commissioner Inland Revenue and shall perform their functions in respect of 
such persons or classes of persons or such areas as the Commissioners, to 
whom they are subordinate, may direct. 
 
 (1C) Deputy Commissioners Inland Reven ue 1[, District Taxation 
Officer Inland Revenue] , A ssistant Commissioners Inland Revenue 1[, 
Assistant Director Audit Inland Revenue], Inland R evenue Officers, 
Superintendents Inland Revenue, Inland Revenue Audit Officers, Inspectors 
Inland Revenue, and Officers of Inland Revenue with any other designation 
shall be subordinate top the Additional Commissioner Inland Revenue.] 
 (2) Notwithstanding the other designations of the officers of 
Federal Excise used in this Act or the rules made there under: 
 (a) the Directorate General (Intelligence & Investigation) 4[Inland 
Revenue] shall consist of a Director General and as many 
Directors, Additional Directors, Deputy Directors and Assistant 
Directors and other officers with any other designation as the 
Board may appoint by notification in the official Gazette; 
 
 5[(aa) The Board may, by notification in the official Gazette,– 
                         
1  Sub-sections (1AA) & (1AB) added by Finance Act, 2017 
2  The expression inserted by Finance Act, 2017 
3  The expressions inserted by Finance Act, 2017 
4  Substituted vide Finance Act, 2007. 
5  New clause “aa” added by Finance Act, 2018. 
The Federal Excise Act, 2005 
 
45 
 (i) specify the functions and jurisdiction of the Directorate 
General and its officers; and 
(ii) confer the powers of authorities specified i n 1[sub-
section (1) of section 29] upon the Directorate General 
and its officers]; 
 (b) the Directorate General 2[***] Internal Audit shall consist of a 
Director General and as many Directors, Additional Directors, 
Deputy Directors and Assistant Directors and other officers 
with any other designation as the Board may appoint by 
notification in the official Gazette; 3[***] 
 (c) the 4[Inland Revenue Services Academy]  shall consist of a 
Director General and as many Directors, Additional Directors, 
Deputy Directors and Assistant Directors and other officers with 
any other designation as the Board may appoint by notification 
in the official Gazette5[; 6[***] 
           7[(d)  the Directorate General of Digital Initiatives shall consist of a 
Director General and as many Directors, Additional Directors, 
Deputy Directors and Assistant Directors and such other 
officers as the Board may, by notification in the official 
Gazette, appoint 8[: and]  
   9[(e) the Directorate -General of law shall consist of a Director 
General and as many Directors, Additional Directors, Deputy 
Directors, Assistant Directors, Law Officers and such other 
officers as the Board may, by notification in the official 
Gazette, appoint and the Board shall, specify therein functions, 
jurisdiction and powers of each such officer of the Directorate-
General of law.] 
                         
1  Words substituted by Finance Supplementary (Second Amendment) Act, 2019 
2  Omitted vide Finance Act, 2007. 
3 Word omitted by Finance Act, 2023  
4 Words substituted by Finance Act, 2022. 
5 For full stop semi colon substituted and word “and” added by Finance Act, 2023 
6 Word “and” omitted by Tax Laws (Amendment) Act, 2024. 
7 New clause added by Finance Act, 2023 
8 For the full stop, a colon and the word "and" substituted by Tax Laws (Amendment) Act, 2024. 
9  New clause (e) added by Tax Laws (Amendment) Act, 2024. 
The Federal Excise Act, 2005 
 
46 
 
 (3) 1[The Board or the Chief Commissioner with the approval of 
the Board, may], empower by name or designation,— 
 
 (a) any 2[Additional Commissioner Inland Revenue]  or 3[Deputy 
Commissioner Inland Revenue] to exercise any of the powers of 
a 4[Commissioner Inland Revenue]; 
 (b) any 4[Deputy Commissioner Inland Revenue] or 5[Assistant 
Commissioner Inland Revenue] to exercise any of the powers 
of an 6[Additional Commissioner Inland Revenue]; 
 (c) any 7[Assistant Commissioner Inland Revenue]  to exercise any 
                         
1 Words substituted by Finance Act, 2010. 
2  Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette  of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 
229 to 259 
3  Substituted for “Deputy Collector” by Finance  Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinanc e was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in th e Gazette of Pakistan Extraordinary Part I at pages 
229 to 259 
4  Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III o f 
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made throu gh Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
5  Substituted for “Assistant Collector of Federal Excise” by Finance A ct, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 june 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
6  Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Financ e (Amendment) Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 
229 to 259 
7  Substituted for “Assistant Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
The Federal Excise Act, 2005 
 
47 
of the powers of a 1[Deputy Commissioner Inland Revenue]; 
and 
 (d) any other 2[officer of Inland Revenue] to exercise any of the 
powers of a 3[Commissioner Inland Revenue] , 1[Additional 
Commissioner Inland Revenue] , 3[Deputy Commissioner 
Inland Revenue] or 2[Assistant Commissioner Inland Revenue]; 
under this Act and the rules made there under. 
 4[ 4 *** ] 
 (5) The officer to whom any powers of any senior officer are 
delegated under this section shall not further delegate such powers. 
  5[29A. Tax Fraud Investigation Wing Inland Revenue.– (1) 
There shall be established a wing to be known as Tax Fraud Investigation 
Wing Inland Revenue.  
  (2) The functions of the tax fraud Investigation Wing Inla nd 
                                                             
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette o f Pakistan Extraordinary 
Part I at pages 229 to 259 
1  Substituted for “Deputy Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Finance (Amendment)  Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 
229 to 259 
2  Substituted for “Officer of Inland Revenue” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
3  Substituted for “Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
2010, dated February 6, 2010, publ ished in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 20 09, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
4  Sub-section (4) omitted by Finance Act, 2010 w.e.f. June 5, 2010. 
5    New section inserted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
48 
Revenue shall be to detect, analyze, investigate, combat and prevent tax 
fraud.  
  (3) The tax fraud Investigation Wing Inland Revenue shall 
comprise Fraud Intelligence and Analysis Unit, Fraud Investigation Unit, 
Legal Unit, Accountants Unit, Digital F orensic and Scene of Crime Unit, 
Administrative Unit or any other Unit as may be notified by the Board by 
notification in the official Gazette.  
  (4) The tax fraud Investigation Wing Inland Revenue shall 
consist of a Chief Investigator and as many followi ng officers, as may be 
notified by the Board, namely:–  
  (a) Senior Investigators, Investigators, Junior Investigators or 
any other officer of Inland Revenue with any other designation;  
  (b) a Senior Forensic Analyst and as many Forensic Analysts 
and Junior Forensic Analysts; and  
  (c) a Senior Data Analyst and as many Data Analysts and 
Junior Data Analysts.  
  (5) The Board may, by notification in the official Gazette,-  
  (a) specify the functions and jurisdiction of the Tax Fraud 
Investigation Wing Inland Revenue and its Units and officers; and  
  (b) confer the powers of authorities specified in section 29 
upon the Tax Fraud Investigation Wing Inland Revenue and its officers 
under clause (a) of sub-section 4.  
  (6) Nothing contained in this section shall prevent the 
authorities appointed under section 29 or any other authority or officer 
conferred with the powers and functions of authorities appointed under 
section 29 from conducting investigation and prosecution under Chapter III 
of the Act.] 
 30. Use of powers of subordinate officer. — (1) An officer 
appointed under this Act shall exercise such powers and discharge such duties 
as are conferred or imposed on him under this Act an d he shall also be 
competent to exercise all powers and discharge all dut ies or functions 
The Federal Excise Act, 2005 
 
49 
conferred or imposed upon any officer subordinate to him. 
 (2) Notwithstanding anything contained in this Act or the rules 
made there under, the Board may, by general or special order, impose such 
limitations or conditions on the exercise of such powers and discharge of 
such duties by any 1[officer of Inland Revenue]as it deems fit. 
 2[  31***] 
 32. Option to pay fine in lieu of confiscation of conveyance. – 
Wherever confiscation is adjudged under this Act or the rules made there 
under, the officer adjudging it may give the owner of the conveyance an 
option to pay in lieu of confiscation such fine as the officer thinks fit. 
 33. Appeals to 3[Commissioner] (Appeals).— 4[(1)] Any person 
other than 5[an SOE or] Federal Excise officer aggrieved b y any decision 
or order 6[ ] passed under this Act or  the rules made  thereunder by a 
1[officer of Inland Revenue up to the rank of 7[Additional Commissioner 
Inland Revenue] , other than a decision or order or notice given  or action 
                         
1  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette o f Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
2  Section (31) omitted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by Finance 
(Amendment) Ordinance, 2 010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. O riginally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
3  Substituted for “Collector” b y Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
4  Numbered vide Finance Act, 2006. 
5 Expression “an SOE or” inserted by Finance Act, 2025. 
6    Expression omitted by Finance Act, 2025. 
7  Substituted for “Additional Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 
6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ord inance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. 
XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 
229 to 259. 
The Federal Excise Act, 2005 
 
50 
taken for recovery of the arrears of duty under this Act or rules made there 
under may within thirty days of receipt of such decision or order prefer 
appeal there from to the 3[Commissioner] (Appeals). 
 1[(1A) where in a particular case, the Commissioner (Appeals) is of 
the opinio n that the recovery of tax levied under this Act, shall cause 
undue hardship to the taxpayer, he, after affording opportunity of being 
heard to the Commissioner or officer of Inland Revenue against whose 
order appeal has been made, may stay the recovery of such tax for a period 
not exceeding thirty days in aggregate.] 
 
 2[(1B) An appeal under sub-section (1) shall– 
(a) be in the prescribed form; 
(b) be verified in the prescribed manner;  
(c) state precisely the grounds upon which the appeal is 
made; 
(d) be accompanied by the prescribed fee specified in 
sub-section (1C); and  
(e) be filed with the Commissioner (Appeals) within 
the time set out in sub-section (1). 
 (1C) The prescribed fee shall be– 
(a) in the case of an appeal against an assessment– 
(i) where the appellant is a company, 
five thousand rupees; or 
(ii) where the appellant is not a 
company, two thousand and five hundred 
rupees; and  
(b) in any other case– 
(i) where appellant is a company, five 
thousand rupees; or 
   (ii) where the appellant is not a 
company, one thousand rupees.] 
 
 3[(2) The 4[Commissioner] (Appeals) may, after giving both parties 
                         
1  Sub section (1A) inserted vid Finance Act, 2013. 
2    New sub-sections (1B) and (1C) inserted by Finance Act, 2020. 
3  Added vide Finance Act, 2006. 
4  Substituted for “Collector” by F inance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
The Federal Excise Act, 2005 
 
51 
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 1[:] 
2[Provided that such order shall  be passed not later than  [one 
hundred and twenty] days from  the date of filing of appeal or within such 
extended period, not exceeding  3[sixty] days, as the 2[Commissioner] 
(Appeals) may, for reasons to be recorded in writing, extend.] 
 4[Provided further that any period during which the proceeding are 
adjourned on account of stay order or Alternative Dispute Resolution 
proceedings or the time taken through adjournment by the petitioner not 
exceeding thirty days shall be excluded for the computation of these 
period.] 
 (3) In deciding an appeal, the 2[Commissioner]  (Appeals) may 
make such further inquiry as may be necessary provided that he shall not 
remand the case for de novo consideration.] 
 5[(4) The Commissioner (Appeals) shall not admit any 
documentary material or evidence which was not produced before the 
Officer Inland Revenue unless the Commissioner (Appeals) is satisfied 
that the appellant was prevented by sufficient cause from producing su ch 
material or evidence before the Officer Inland Revenue.] 
 6[(5) Registered person shall have an option to directly file an 
appeal before Appellate Tribunal Inland Revenue without availing right of 
appeal under this section.] 
 7[33A. Omitted 
 
                                                             
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
1  Full stop substituted vide Finance Act, 2007. 
2  Inserted vide Finance Act, 2007. 
3  Substituted vide Finance Act, 2009. 
4  Added vide Finance Act, 2009. 
5     New sub-section (4) inserted by Finance Act, 2020. 
6     Sub-section (5) inserted by Finance Act, 2025. 
7     Section 33A omitted by Finance Act, 2025. 
The Federal Excise Act, 2005 
 
52 
 34. Appeals to the Appellate Tribunal 1[***].–– 2[(1)  Any 
person, other than an SOE, aggrieved by any order passed by the Board or 
the Commissioner Inland Revenue under section 35 or an order passed by 
an Officer of Inland Revenue where sub -section (5) of section 33 applies 
or the Commissioner (Appeals) under this Act or the rules made 
thereunder may, within thirty days of the receipt of such order, prefer an 
appeal to the Appellate Tribunal: 
  Provided that where sub -section (11) of section 134A of the 
Income Tax Ordinance, 2001 (XLIX of 2001) shall apply, an SOE may 
prefer an appeal under this sub-section.] 
 3[(2)***] 
 4[(3) The Appellate Tribunal may admit, hear and dispose of the 
appeal as per procedure laid down in sections 131 and 132 of the Income 
Tax Ordinance, 2001 (XLIX of 2001), and rules made thereunder.] 
 5[34A. Reference to the High Court.— 6[(1)  Within sixty days of 
the order of the Appellate Tribunal, the aggrieved person or the 
Commissioner may make a reference in the prescribed form along with a 
statement of the case and complete record of the Appellate Tribunal to the 
High Court, stating any question of law arising out of such order.] 
  (2) Provisions of section 133 of the Income Tax Ordinance, 
2001 (XLIX of 2001) and rules made thereunder relating  to a reference to 
the High Court shall, mutatis mut andis, apply to references to the High 
Court under this Act.] 
       7[34AB. Saving.– The period of limitation provided in sub-section (1) 
of section 34 and sub -section (1) of section 34A shall continue t o apply 
where any decision of the Commissioner (Appeals) or the Appellate 
Tribunal is received prior to the date of commencement of the Tax Laws 
(Amendment) Act, 2024 (V of 2024).] 
                         
1    Words “and Reference to High Court” omitted by Finance Act, 2011. 
2    Sub-section (1) of section 34 substituted by Finance Act, 2025. 
3  Sub-section (2) omitted by Finance Act, 2010. 
4 New sub-section (3) inserted by Finance Act, 2020. 
5  Section 34A substituted by Tax Laws (Amendment) Act, 2024. 
6 Sub-section (1) of section 34A substituted by Finance Act, 2025. 
7 New section 34AB inserted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
53 
 
 35. Powers of Board or 1[Commissioner] to pass certain 
orders.– (1) The Board or the 2[Commissioner] within his jurisdiction, may 
suo moto  2[, or otherwise ] call for and examine  the records of any 
proceedings under this Act for the purpose of satisfying itself or, as the case 
may be, himself as to the legality or propriety of any decision or order passed 
by a subordinate officer and may pass such order as it or he may think fit. 
 (2) No order confiscating goods of greater value or enhancing any 
fine, or imposing or enhancing any penalty, or requiring payment of any duty 
not levied or short-levied shall be passed under sub -section (1) unless the 
person affected thereby has been given an opportunity of showing cause 
against it and of being heard in person or through a counsel or other person 
duly authorized by him. 
 (3) No record of any proceedings relating to any decision or order 
passed by any 3[officer of Inland Revenue]  shall be called for or examined 
under subsection (1) after the expiry of two years from the date of such 
decision or order. 
 4[Explanation.– For the purpose of sections 35, 45 and 46 and for 
removal of doubt, it is declared that the powers of the Board, Commissioner 
or officer of Inland Revenue under these sections are independent of the 
powers of the Board under section 42B and nothing contained in section 42B 
restrict the powers of the Board, Commissioner or officer of Inland Revenue 
under these sections or to conduct audit under these sections.] 
                         
1  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, pro mulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
2  Comma and words inserted by Finance Act, 2015. 
3  Substituted for “Federal Excise Officer” by Finance Act, 2010  w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was pres ented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
4  Explanation inserted by Finance Act, 2013. It aims at nullifying judgments of higher courts, see under 
section 42B. 
The Federal Excise Act, 2005 
 
54 
 36. Power to rectify mistakes in orders. – The Federal 
Government, the Board or any 1[officer of Inland Revenue]  may rectify any 
mistake which is apparent from the record in any order passed by it or him 
under any of the provisions of this Act or the rules made there under, on its 
or his own motion or on an application  made by a person affected by the 
order within three years of the passing of such order provided that no such 
rectification which has the  effect of enhancing any  penalty or fine or 
requiring the payment of a greater amount of duty shall be made unless the 
person affected by the proposed rectification has be en given an  
opportunity of being heard. 
 37. Deposit, pending appeal, of duty demanded or penalty 
levied.– 
 (1) Where in any appeal, the decision or order appealed against 
relates to any duty demanded or penalty imposed under this Act, the 
person desirous of appealing against such decision or order shall, pending 
the appeal, deposit the duty demanded or the penalty imposed provided that 
the Appellate Tribunal or 2[Commissioner] (Appeals) may in any particular 
case dispense with such deposit subject to such conditions as it may deem fit 
to impose so as to safeguard the interest of revenue. 
 (2) The order for such dispensation under sub-section (1) shall cease 
to have effect on the expiration of a period of six months following the date 
on which order for dispensation was passed or until the order of dispensation 
is withdrawn earlier or the case is finally decided earlier by the Appellate 
Tribunal or 1[Commissioner] (Appeals). 
 (3) Notwithstanding sub -sections (1) and (2), the Appellate 
Tribunal or 1[Commissioner] (Appeals) may direct that, pending decision 
                         
1  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010 . The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliam ent but lapsed on 5 June 2010 as Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraord inary 
Part I at pages 229 to 259 
2  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulga ted as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
55 
on the appeal, the duty demanded or penalty imposed, alongwith the default 
surcharge payable under this Act, be paid by the appellant in suitable 
installments spread over a period not exceeding six months from the date of 
such direction: 
Provided that where a person has, at the time of filing appeal, 
deposited fifteen per cent of the liability covered under the decision or 
order appealed against, he shall not be required to separately seek stay 
against recovery and stay in such a case shall commence from the date of 
payment of such fifteen per cent amount and shall remain valid till the 
expiry of a period of six months or till the decision of the appeal, whichever 
is earlier unless the case is decided in his fa vour and the amount so paid is 
claimed to have become due for refund 1[:] 
 
1[Provided further that the Commissioner Inland Revenue or any 
officer of Inland Revenue subordinate to him shall not issue notice under 
this section or recovery rules made under th e Federal Excise Rules, 2005 
for recovery of any tax due from a taxpayer if the said taxpayer has filed 
an appeal under section 33 in respect of the order under which the tax 
sought to be recovered has become payable and the appeal has not been 
decided by the Commissioner (Appeals), subject to the condition that 
2[ten] per cent of the said amount of tax due has been paid by the 
taxpayer.] 
 
3[38. Alternative dispute resolution. - (1) Notwithstanding any 
other provision of this Act, or the rules made thereunde r, an aggrieved 
person in connection with any dispute pertaining to- 
 
(a) the liability of tax of' fifty million -rupees or above against the 
aggrieved person or admissibility of refund, as the case may 
be;  
(b) the extent of waiver of default surcharge and penalty; or  
(c) any other specific relief required to resolve the dispute,  
 
may apply, except where criminal proceedings have been initiated, to the 
Board for the appointment of a committee for the resolution of any 
                         
1  Colon & new proviso added by Finance Act, 2017 
2  Words “ten” substituted by Finance Act, 2018. 
3    Section 38 substituted by Tax Laws (Amendment) Act, 2024. 
The Federal Excise Act, 2005 
 
56 
hardship or dispute mentioned in detail in the application:  
 
Provided that where the aggrieved person is a state -owned 
enterprise (SOE), the li mit of tax liability of fifty million rupees or above 
mentioned in clause (a) of sub -section (1) shall not apply and it shall be 
mandatory for such aggrieved SOE  to apply to the Board for the 
appointment of a committee for the resolution of any dispute under this 
section:  
 
Provided further that no suit, prosecution, or other legal 
proceedings shall lie against the SOE in relation to the dispute resolved 
under this section.  
 
Explanation.- State-owned enterprise shall have the same meaning 
as assigned thereto in the State -Owned Enterprises (Governance and 
Operations) Act, 2023 (VII of 2023).  
 
(2) Provisions of section 134A of the Income Tax Ordinance, 2001 
(XLIX of 2001) and rules made thereunder relating to alternative dispute 
resolution shall, mutatis mutandis, apply to a pplications for alternative 
dispute resolution under this Act.] 
 
 39. Exclusion of time taken for copy. – In computing the period 
of limitation specified for an appeal or application under this Chapter, the 
day on which the order complained was served, and if the party preferring 
the appeal or making the application was not furnished with a copy of the 
order when the notice of the order was served upon him, the time requisite 
for obtaining a copy of such order shall be excluded. 
 
CHAPTER VI  
 
SUPPLEMENTAL PROVISIONS 
 40. Power of Board to make rules. – (1) The Board may make 
rules to carry into effect the purposes of any or all the provisions of this Act 
including charging fee for processing of returns, claims and other 
documents and for preparation of copies thereof. 
 (2) In making rules under this section, the Board may provide that 
The Federal Excise Act, 2005 
 
57 
any person committing a breach of any rule shall, without prejudice to any 
other action that may be taken against him under this Act, be liable to such 
penalty as may be prescribed under the rules and that any article in respect of 
which any such breach is committed shall be confiscated or destroyed. 
 (3) The Board may, i n respect of cigarettes, make rules or issue 
instructions for the purpose of affixing duty stamps and banderoles and any 
instructions issued in this behalf shall have the force of rules issued under this 
Act. 
           1[(4)   All rules made under sub -section (1) or any other provisions 
of this Act, shall be collected, arranged and published along with general 
orders and departmental instructions and rulings, if any, at appropriate 
intervals and sold to the public at reasonable price or may be placed 
regularly on the official website maintained by the Board.] 
 41. Bar of suit and limitation of suit and other legal 
proceedings.– (1) No suit shall be brought in any civil court to set aside or 
modify any order passed, or any assessment, levy or collection of any duty, 
under this Act. 
 (2) No suit prosecution or other legal proceeding shall lie against 
the Federal Government or against any officer of the Government in respect 
of any order passed in good faith or any act in good faith done or ordered 
to be done under this Act. 
 (3) Notwithstanding anything in any other law for the time being 
in force, no investigation or inquiry shall be undertaken or initiated by any 
governmental agency against any officer or official for anything done in his 
official capacity under this Act, rules, instructions or direction made or issued 
there under without the prior approval of the Board. 
 42. Observance of Board's orders, directions and instructions.– 
All officers and persons employed in the execution of this Act and the rules 
made there under  shall observe and follow the orders, directions and 
instructions of the Board provided that no such order, direction or 
instruction shall be given by the Board so as to interfere with the discretion 
of an officer in deciding the issues o r matters brought before him for 
                         
1 New sub-section added by Finance Act, 2023. 
The Federal Excise Act, 2005 
 
58 
adjudication under this Act or rules made there under. 
 1[42A. Reference to authorities .– Any reference to Collector, 
Additional Collector, Deputy Collector, Assistant Collector, 
Superintendent and an officer of federal exc ise, wherever occurring, in 
this Act and the rules Notifications, clarifications, general orders or orders 
made or issued there under, shall be construed as reference to 
Commissioner Inland Revenue,  Additional Commissioner Inland 
Revenue, Deputy Commissioner Inland Revenue, Assistant Commissioner 
Inland Revenue, Superintendent Inland Revenue and an officer of inland 
Revenue, respectively. 
 2[42B. Selection for audit by the Board.– (1) The Board may select 
persons or classes of persons for audit of records and documents through 
computer ballot which may be random or parametric as the Board may 
deem fit. 
 3[(1A) Notwithstanding anything contained in this Act or any other 
law, for the time being in force, the Board shall keep the parameters 
confidential.] 
 (2) Audit of such persons selected under sub -section (1) shall be 
conducted as per procedure given in section 46 and all the provisions of 
Act shall apply accordingly. 
 (3) For the removal of doubt, it is hereby declared that Board 
shall be deemed always to h ave had, the power to select any persons or 
classes of persons for audit.] 
 4[42C. Reward to Inland Revenue officers and officials. – (1) In 
cases involving concealment or evasion of excise duty and other taxes, 
cash reward shall be sanctioned to the office rs and officials of Inland 
Revenue for their meritorious conduct in such cases and to the informer 
                         
1 Section 42A and 42B inserted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2 Section 42B inserted by Finance Act, 2010. 
3    New sub-section (1A) inserted by Finance Act, 2020. 
4  Section 42C inserted by Finance Act, 2013.  
The Federal Excise Act, 2005 
 
59 
providing credible information leading to such detection, as may be 
prescribed by the Board, only after realization of part or whole of the taxes 
involved in such cases. 
 (1) The Board may, by notification in the official Gazette, 
prescribe the procedure in this behalf and specify the apportionment  of 
reward sanctioned under this section for individual performance or to 
collective welfare of the officers and officials of Inland Revenue.] 
 1[42D. Reward to whistleblowers .-(1) The Boar d may sanction 
reward to whistleblowers in cases of concealment or evasion of duty, 
corruption or misconduct providing credible information leading to such 
detection of evasion of duty. 
 (2) The Board may, by notification in the official Gazette, 
prescribe the procedure in this behalf and also specify the apportionment 
of reward sanctioned under this section for whistleblowers. 
 (3) The claim for reward by the whistleblower shall be  rejected, 
if- 
 (a) the information provided is of no value; 
 (b) the Board already had the information; 
 (c) the information was available in public records; or 
 (d) no collection of duty is made from the information provided 
from which the Board can pay the reward. 
(4) For the purpose of this section, “whistleblower” means a 
person who reports concealment or evasion of duty leading to detection or 
collection of duty, corruption or misconduct, to the competent authority 
having power to t ake action against the person or  a federal excise 
authority committing fraud, corruption, misconduct, or involved in 
concealment or evasion of duty.] 
 43. Removal of difficulties and condonation of time limit etc.— 
(1) If any difficulty or situation arises in giving effect t o or applying the 
provisions of this Act or the rules made or notifications issued there under, 
                         
1  Section 42D added by Finance Act, 2015. 
The Federal Excise Act, 2005 
 
60 
the Board may, through a general order or otherwise, issue instructions or 
directions for such actions to be taken by an officer of 1[Federal Excise] or 
any other person as it considers necessary or expedient for the purpose of 
removing the difficulty or tackling such situation and every such officer or 
person shall be bound to comply with such instructions or directions in such 
manner as may be specified therein. 
 
(2)  Where any time or period has been specified under any of the 
provisions of this Act or rules made there  under within which any 
application is to be made or any act or thing is to be done, the Board may  
2[at any time before or after the expiry of su ch time or period], in any case 
or class of cases, permit such application to be made or such act or thing to 
done within such time or period as it may consider appropriate provided that 
the Board may subject to such limitations or conditions as may be specified 
therein, empower any 3[Commissioner]  or other 4[officer of Inland 
Revenue] to exercise the powers under this subsection in any case or class 
of cases. 
 
5[Explanation.– For the purpose of this section, the expression 
“any act or thing is to be done ” includes any act or thing to be done by the 
registered person or by the authorities specified in section 29 of this Act.] 
  
 6[43A. Issuance of duplicate of 7[Federal Excise] documents.– An 
officer of federal excise not below the rank of Assistant Collec tor may, on 
                         
1  Words “Inland Revenue” substituted for Federal Excise by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made b y 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of 
Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament 
did not approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance 
No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2   Words inserted by Finance Act, 2022. 
3  Substituted for “Collector” by Finance Act, 2010  w.e.f. June 5, 2010. The same amendment was made by Finance (Amendment) 
Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary 
Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not appr ove it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, 
dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
4  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was ma de by Finance 
(Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette of Pakistan 
Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 20 10 as Parliament did not 
approve it. Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII  
of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
5  Explanation inserted by Finance Act, 2011. 
6  Inserted vide Finance Act, 2008. 
7  The “Inland Revenue” were substituted for “Federal Excise by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was ma de 
by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, published in the Gazette 
of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as 
Parliament did not approve it. Ori ginally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
The Federal Excise Act, 2005 
 
61 
payment of one hundred rupees, issue an attested duplicate of any 5[federal 
excise] document as is available with the department or has been filed 
under this Act or rules made there under to a relevant registered person 
applying for the same.] 
 
 44. Refund of duty. —(1) No refund of any amount of duty  
accrued for any reason under this Act or rules made there  under shall be 
allowed unless claimed within one year of its accrual. 
 
 (2) In a case where a registered person did not avail adjustment of 
duty admissible at the relevant time, the 1[Commissioner] may allow such 
person to avail the adjustment at any subsequent time provided that claim 
for such adjustment is made within a period of one year from the date on 
which it was admissible. 
 (3) In a case where claim for refund or adjustment has accrued in 
consequence of any decision or judgment of any Federal Excise Officer, the 
Tribunal or Court, the period of one year, for the purpose of this section, 
shall be computed from the date of such decision or judgment. 
 2[44A. Delayed refund.- Where a refund due under section 44 is not made 
within the time specified in this behalf, there shall be paid to the claimant, in 
addition the amount of refund due to him, a further sum equal to KIBOR per 
annum of the amount of refund due, from the date following the expiry of the 
time specified as aforesaid, to the day preceding the day of payment of refund:  
 Provided that where there is a reason to believe that a person has claimed 
the refund which is not admissible to him, he shall not be entitled to additional 
amount unless the investigation of his claim is completed.] 
 45. Access to records and posting of excise staff, etc.— (1)    A  
person who is required to maintain any record or documents under this Act 
or any other law shall, as and when required by the 3[officer of Inland 
                         
1  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This O rdinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259 
2  Inserted vide Finance Act, 2009. 
3  Substituted for “Federal Excise Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was 
made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 
2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was 
presented in the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Or iginally this 
amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII 
of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
62 
Revenue] produce record or  documents which are in his possession or 
control or in the possession or control of his agent and where such record or 
documents have been kept on electronic data, he shall allow access to such 
officer to have access and use of any machine on which such data is kept 
and shall facilitate such officer to retrieve whole or part of such data in such 
manner and to such extent as may be required by him. 
 (2) Subject to such  conditions and restrictions, as deemed fit to 
specify, the Board 1[***] may, post 3[officer of Inland Revenue]  to the 
premises of registered person or class of such persons to monitor production, 
removal or sale of goods and the stock position or the main tenance of 
records 2[.] 
 
2[***] 
 
 3[(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.] 
 
 4[45A. Monitoring or tracking by electronic or other means. – (1) 
Subject to such conditions, restriction and procedures as it may deem fit to 
impose or specify, the Board may, by notification ion the official Gazette, 
specify any registered person or class of registered persons or any goods 
or class of goods in respect of which monitoring or tracking of production, 
sales, clearance, stocks or any other related activ ity may be implemented 
through electronic or other means as may be prescribed. 
 
 (2) From such date, as may be prescribed by the Board, no 
excisable goods shall be removed or sold by the manufacturer or any other 
person without affixing tax stamp, banderol e, stickers, labels, 5[barcodes,] 
etc. in any such form, style and manner as may be prescribed by the Board 
in this behalf.] 
 
                         
1  Words “or Chief Commissioner” omitted by Finance Act, 2018. 
2  Full stop inserted and proviso omitted by Finance Act, 2018. 
3  Inserted vide Finance Act, 2008. 
4  Section 45A inserted by Finance Act, 2013. 
5  Word and comma inserted by Finance Act, 2015. 
The Federal Excise Act, 2005 
 
63 
 1[(3) Such tax stamps, banderoles, stickers, labels, barcodes etc., 
shall be acquired by the registered person referred to in sub -section (2) 
from a licensee appointed by the Board for the purpose, against price 
approved by the Board, which shall include the cost of equipment installed 
by such licensee in the premises of the said registered person.] 
 
2[45AA. Licensing of brand name. - (1) Manufacturers of the 
specified goods shall be required to obtain brand licence for each brand or 
stock keeping unit (SKU) in such manner as may be prescribed by the 
Board.  
(2) Any specified brand and SKU found to be sold without obtaining a 
licence from the Board shall be deemed counterfeit goods and liable to 
outright confiscation and destruction in the prescribed manner and such 
destruction and confiscation shall be without prejudice to any other penal 
action which may be taken under this Act.] 
 
 46. 3[***] Audit.— (1) The 4[officer of Inland Revenue]  
authorized by the Board 5[or the Commissioner] by designation may, once 
in a year, after giving advance notice in writing, conduct audit of the 
records and documents of any person registered under this Act. 
 (2) In case the 6[Commissioner] has information or sufficient 
evidence showing that such registered person is involved in fraud or 
evasion of duty, he may authorize a Federal Excise Officer, not below the 
                         
1  Sub-section (3) added by Finance Act, 2015. 
2 New Section 45AA inserted by Finance Act, 2021. 
3  Word “Departmental” omitted by Finance Act, 2015. 
4  Substituted for “Federal Excis e Officer” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment 
was made by Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated 
February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This 
Ordinance was presented in the Parliament but lapsed on 5 June 2010 as Parliament did not a pprove it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259. 
5  Words inserted by Finance Act, 2010. 
6  Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordin ance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
The Federal Excise Act, 2005 
 
64 
rank of 1[Assistant Commissioner], to conduct audit at any time in a year. 
 2[(2A) After completion of the audit under this section or any other 
provision of law, the officer of Inland Revenue may, after obtaining the 
registered person’s explanation on all the issues raised in the audit shall 
pass an order under section 14, imposing the amount of duty as per law, 
charging default surcharge, imposing penalty and recovery of any amount 
erroneously refunded.] 
 (3) Notwithstanding the penalties prescribed in section 19, if a 
registered person wishes to deposit the amount of duty not paid, short paid or 
the amount of duty evaded along with default surcharge voluntarily, 
whenever it comes to his notice, before commencement of audit, no penalty 
shall be recovered from him: 
Provided that if a registered person wishes to deposit the amount of 
duty not paid, short paid or amount of duty evaded along with default 
surcharge during or after the audit but before the 3[determination of liability 
under sub-section (2A)] conclusion of original adjudication proceedings, he 
may deposit such amount along with twenty five percent of the amount of 
penalty prescribed under this Act or the rules made there under and in such 
case, further proceedings in the case shall abate.  
 4[(4) The Board may appoint as many special audit p anels as may 
be necessary, comprising two or more members from the following – 
 
 (a) an officer or officers of Inland Revenue; 
 
 (b) a firm of Chartered Accountants as defined under the 
Chartered Accountants Ordinance, 1961 (X of 1961); 
  
 (c) a firm of Cost and Management Accountants as defined under 
the Cost and Managem ent Accountants Act, 1966 (XIV of 
                         
1  Substituted for “Assistant Collector of Federal Excise” by Finance Act, 2010 w.e.f. June 5, 2010. The same 
amendment was made by  Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 
2010, dated February 6, 2010, published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. 
This Ordinance was presented in the Parliament but lapsed on 5 June 2010 as  Parliament did not approve it. 
Originally this amendment was made through Finance (Amendment) Ordinance, 2009, promulgated as 
Ordinance No. XXII of 2009, dated October 28, 2009, published in the Gazette of Pakistan Extraordinary 
Part I at pages 229 to 259 
2  Sub-section (2A) inserted by Finance Act, 2010. 
3  Substituted for “conclusion of original adjudication proceedings” by Finance Act, 2010 w.e.f. June 5, 2010 
4  Substituted for sub-section (4) by Finance Act, 2015. 
The Federal Excise Act, 2005 
 
65 
1966); or  
 
 (d) any other person as directed by the Board,  
 
  to conduct audit of a registered person or persons, including 
audit of refund claims and fo rensic audit and the scope of 
such audit shall be determined by the Board or the 
Commissioner Inland Revenue on a case -to-case basis. In 
addition, the Board may, where it considers appropriate, also 
get such audit conducted jointly with similar audits bein g 
conducted by provincial administrations of sales tax on 
services.] 
 
 1[(5) Each special audit panel shall be headed by a chairman who 
shall be an officer of Inland Revenue; 
 
 (6) If any one member of the special audit panel, other than the 
chairman, is absent from conducting an audit, the proceedings of the audit 
may continue and the audit conducted by the special audit panel shall not 
be invalid or be called in question merely on the ground of such absence. 
 
 (7) The Board may prescribe rules in respect of constitution, 
procedure and working of special audit panel. 
 
 (8) Every member of the special audit panel shall have the 
powers of officers of Inland Revenue under sections 23 and 45 and sub -
sections (1) to (3) of section 46.] 
 
 2[9] The audit of the re gistered person shall generally be a 
composite audit covering all duties and taxes to which his business or 
activity is liable under the laws administered by the Board. 
 
3[***] 
 
 
 
                         
1  Sub-sections (5), (6), (7) and (8) inserted by Finance Act, 2015. 
2  Sub-section (5) re-numbered as sub-section (9) by Finance Act, 2015. 
3  Sub-section (10) omitted by Finance Act, 2020. 
The Federal Excise Act, 2005 
 
66 
 1[47. Service of notices and other documents .–– (1)
Subject to this Act , any notice, order or requisition required to be served 
on a resident individual other than in a representative capacity for the 
purposes of this Act shall be treated as properly served on the individual 
if–  
  
 (a) personally served on the individual  or, in th e case of an 
individual under a legal disability or a non -resident individual, 
the representative as defined in section 172 of the Income Tax 
Ordinance, 2001 (XLIX of 2001) of the individual; 
 
 (b) sent by registered post or courier service to the place specified in 
clause (b) of sub-section (2) or to the individual’s usual or last 
known address in Pakistan; or 
 
 (c) served on the individual in the manner prescribed for service of a 
summons under the Code of Civil Procedure, 1908 (Act V of 
1908) 1[; or]  
 
 2(d) sent electronically through email or to the e -folder maintained 
for the purpose of e -filing of sales tax -cum-Federal excise 
returns by the 3[registered person.] 
 
(2) Subject to this Act, any notice, order or requisition required to be 
served on any person (other than a resident individual to whom sub-section 
(1) applies) for the purposes of this Act, shall be treated as properly served on 
the person if– 
 
 (a) personally served on the representative of the person; 
 
 (b) sent by registered post or courie r service to the person’s 
registered office or address for service of notices under this Act, 
in Pakistan, or where the person does not have such office or 
                         
1  Section 47 substituted by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Par liament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2  The word “or” and clause (d) added by Finance Act, 2017. 
3     Words substituted by Finance Act, 2020. 
The Federal Excise Act, 2005 
 
67 
address, the notice is sent by registered post to any office or 
place of business of the [person in Pakistan; or 
 
 (c) served on the person in the manner prescribed for service of a 
summons under the Code of Civil Procedure, 1908 (V of 1908) 
1[; or 
 
 (d) sent electronically through email or to the e -folder maintained 
for the purpose of e -filing of sales tax-cum-Federal excise 
returns by the 1[registered person.] 
 
(3) Where as association of person is dissolved, any notice, order or 
requisition required to be served under this Act, on the association may be 
served on any person who was the principal office r or a member of the 
association immediately before such dissolution. 
 
(4) Where, business stands discontinued, any notice, order or 
requisition required to be served under this Act, on the person discontinuing 
the business may be served on the person personally or any individual who 
was the person’s representative at the time of discontinuance, 
 
(5) The validity of any service of a notice under this Act, shall not 
be called into question after th e notice has been complied with in any 
manner.]                
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
 2[47A. Agreements for the exchange of information  3[or 
assistance in recovery of duties .]– (1) The Federal Government may 
enter into bilateral or multilateral agreements with provincial governments 
or with governments of foreign countries  for the exchange of information, 
including electronic exchange of information, with respect to excise duty 
imposed under this Act or any other law of Paki stan, or under the 
corresponding laws of that country and may, by notification in the official 
Gazette, make such provisions as may be necessary for implementing such 
agreements. 
 
                         
1  The word “or” and clause (d) added by Finance Act, 2017. 
2  Sections 47A and 47B added by Finance Act, 2015. 
3 Words inserted by Finance Act, 2021. 
The Federal Excise Act, 2005 
 
68 
 1[(1A)  Notwithstanding anything contained in this Act, the Board 
shall hav e power to share data or information including real time data 
videos, images received under the provisions of this Act with any other 
Ministry or Division of the Federal Government or Provincial 
Government, subject to such limitations and conditions an may  be 
specified by the Board.] 
 
 (2) The provisions of section 107 of the Income Tax Ordinance, 
2001 (XLIX of 2001) shall, mutatis mutandis, apply to this section. 
 
2[(3) The Federal Government may enter into a bilateral or 
multilateral convention, and inter -governmental agreement or similar 
agreement or mechanism for assistance in the recovery of duties.] 
 
 3[47AB. Real-time access to information and databases.─  (1) 
Notwithstanding anything contained in any law for the time being in force, 
including but not limited to the National Database and Registration 
Authority Ordinance, 2000 (Ordinance VIII of 2000) and the Emigrati on 
Ordinance, 1979 (Ordinance XVIII of 1979), arrangements shall be made 
to provide real-time access of information and database to the Board in the 
prescribed form and manner by– 
(a) the National Database and Registration Authority with 
respect to informa tion pertaining to National Identity Card 
(NIC), Pakistan Origin Card, Overseas Identity Card, Alien 
Registration Card and other particulars contained in the 
citizen database; 
(b) the Federal Investigation Agency and the Bureau of 
Emigration and Overseas E mployment with respect to 
details of international travel; 
(c) the Islamabad Capital Territory and provincial  and local 
land record and development authorities with respect to 
record-of-rights including digitized edition of record -of-
rights, periodic reco rd, record of mutations and report of 
acquisition of rights; 
                         
1 New sub-section (1A) inserted by Finance Act, 2021. 
2 New sub-section (3) inserted by Finance Act, 2021. 
3 New section 47AB inserted by Finance Act, 2020. 
The Federal Excise Act, 2005 
 
69 
(d) the Islamabad Capital Territory and provincial excise and 
taxation departments with respect to information regarding 
registration of vehicles, transfer of ownership and other 
associated record; 
(e) all electricity suppliers and gas transmission and 
distribution companies with respect to particulars of a 
consumer, the units consumed and the amount of bill 
charged or paid: 
 
Provided that where the connection is shared or is 
used by a person othe r than the owner, the name and NIC 
of the owner and the user shall also be furnished: 
 
Provided further that all electricity suppliers and gas 
transmission and distribution companies shall make 
arrangements by the 1st day of January, 2021 for allowing 
consumers to update the ratio of sharing of a connection or 
the particulars of users, as the case may be; and 
 
(f) any other agency, authority, institution or organization 
notified by the Board. 
 
(2) The Board shall make arrangements for laying the 
infrastructure for real -time access to information and database under sub -
section (1) and aligning it with its own database in the manner as may be 
prescribed. 
 
(3) Until real-time access to information and database is made 
available under sub -section (1), such infor mation and data shall be 
provided periodically in such form and manner as may be prescribed. 
 
  (4)  Subject to section 47B, all information received under this 
section shall be used only for tax purposes and kept confidential.] 
 
The Federal Excise Act, 2005 
 
70 
 1[47B. Disclosure of info rmation by a public s ervant.─ (1) Any 
information acquired under any provision of this Act shall be confidential 
and no public servant shall disclose any such information, except as 
provided under section 216 of the Income Tax Ordinance, 2001 (XLIX of 
2001). 
 
 (2) Notwithstanding anything contained in sub-section (1) and the 
Freedom of Information Ordinance, 2002 (XCVI of 2002), any 
information received or supplied in pursuance of bilateral or multilateral 
agreements with government of foreign countries for exchange of 
information under section 47A shall be confidential]. 
 
 2[47C. Validation.– 3[(1)] All notifications and orders issued and 
notified in exercise of the powers conferred upon the Federal Government, 
before the commencement of Finance Act, 2017  shall be deemed to hav e 
been validly issued and notified in exercise of those powers.] 
 
 3[(2) Notwithstanding any omission, irregularity or deficiency in 
the establishment of or conferment of powers and functions on the 
Directorate General (Intelligence and Investigation), Inl and Revenue and 
authorities specified in clause (a) of sub -section (2) of section 29 of this 
Act, all orders passed, notices issued and actions taken in exercise or 
purported exercise of the powers and functions of the Officers of Inland 
Revenue under this  Act by the Director General (Intelligence and 
Investigation), Inland Revenue or the authorities specified in clause (a) of 
sub-section (2) of section 29 of this Act shall be treated to have been 
validly passed, issued and taken under this Act.] 
 48. Repeal.–(1) Subject to the provisions of sub -section (2), the 
Central Excises Act, 1944 (I of 1944) shall stand repealed with effect from 
the date notified under sub-section (3) of section 1. 
 (2) Unless otherwise directed by the Federal Government, in case 
of area where the repealed Act was extended through an order by a Governor 
of the Province or otherwise through an order by any other authority, the 
application of the repealed Act shall continue to be in force till this Act is 
                         
1  Section 47B substituted through Finance Act, 2016. 
2  New section 47C inserted through by Finance Act, 2017. 
3  Section 47C re-numbered and new sub-section (2) added by Finance Act, 2018. 
The Federal Excise Act, 2005 
 
71 
made applicable in that area. 
 1[49. Fee and service charges. – 2[(1)] The 3[Board with the 
approval of Federal Minster -in-charge”] may, by notification in the 
official Gazette, subject to such conditions, limitations or restrictions as it 
may deem fit to impose, levy fee and service cha rges for valuation, in 
respect of any other service or control mechanism provided by any 
formation under the control of the Board, including ventures of public -
private partnership, at such rates as may be specified in the notification.] 
 4[(2) The Board ma y authorize and prescribe the manner in which 
fee and service charges collected under sub-section (1) shall be expended.] 
 5[50.  Uniform.– The Board may, by notification in the official 
Gazette, prescribe rules for wearing of uniform by officers and staff  of 
Inland Revenue Services.]          
                         
1  New section 49 inserted through Finance Act, 2019. 
2    Existing sub-section renumbered as sub-section (1) by Finance Act, 2021. 
3   Words “Federal Government” substituted by Tax Laws (Amendment) Act, 2020. 
4 New sub-section  (2) inserted by Finance Act, 2021. 
5   New section 50 added by Finance Act, 2022. 
The Federal Excise Act, 2005 
 
72 
FIRST SCHEDULE 
[See Section 3] 
 
TABLE 1 
(EXCISABLE GOODS) 
 
 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
 
1[1*** 
omitted] 
 
   
 1[2*** 
omitted] 
 
 
 
  
3 Concentrates for aerated 
beverages in all forms 
including syrup form 
 
2106.9010 Fifty per cent ad val. 
 
4 Aerated waters 2201.1020  2[Twenty] per cent of 
retail price 
5 Aerated waters, containing 
added sugar or other 
sweetening matter or flavored 
 
2202.1010 3[Twenty] per cent of 
retail price 
6 Aerated waters if 
manufactured wholly from 
juices or pulp of 4[  ] 
vegetables, food grains or 
fruits and which do not 
contain any other ingredient, 
indigenous or imported, other 
than sugar, coloring materials, 
preservatives or additives in 
Respective 
headings 
 
 
 
 
5[Twenty]  per cent of 
retail price 
                         
1 Serial numbers 1, 2 and entries relating thereto omitted through Finance Act, 2021. 
2  The figure “thirteen” substituted through Finance (Supplementary) Act, 2023. 
3  The figure “thirteen” substituted through Finance (Supplementary) Act, 2023. 
4  Word omitted by Finance Act, 2008. 
5  The figure “thirteen” substituted through Finance (Supplementary) Act, 2023. 
The Federal Excise Act, 2005 
 
73 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
 
quantities prescribed under 
the West Pakistan Pure Food 
Rules, 1965.  
 
7 Un-manufactured tobacco 24.01 1[Three hundred and 
ninety rupees] per 
kilogram 
 
2[7a Acetate tow Respective 
heading 
Rupees forty four 
thousand per kg.] 
    
3[8 
 
 
 
 
 
4[8a 
Cigarettes of tobacco or tobacco 
substitutes excluding locally 
produced cigarettes. 
 
 
 
E-liquids by whatsoever name 
called, for electric cigarette kits. 
 
 
 
24.02 
 
 
 
 
Respective 
heading 
Sixty five percent of 
retail price or the rate 
of duty as prescribed 
against S. No. 9 
whichever is higher. 
 
Rupees ten 5[thousand 
per kg  6[or sixty five 
percent of retail price 
whichever is higher]. 
 
8b Cigars, cheroots and cigarillos of 
tobacco and tobacco substitute. 
Respective 
heading 
Sixty five percent of 
retail price or rupees 
ten thousand per kg 
whichever is higher.] 
 
7[8c. 
 
Tobacco mixture in an 
electrically heated tobacco 
product by whatever name 
called, intended for consumption 
 
8[Respective 
headings] 
 
9[Rupees sixteen 
thousand five hundred 
per kg] 
                         
1  The figure “ten” substituted through Tax Laws (Second Amendment) Ordinance, 2022. 
2 New serial number 7a inserted by Finance Act, 2024. 
3  Serial number 8 substituted by Finance Act, 2020. 
4 New serial numbers 8a and 8b inserted by Finance Act, 2020. 
5  Words substituted by Finance Act, 2022. 
6  Words added by Finance Act, 2024. 
7 New serial number 8c inserted by Finance Act, 2021. 
8 Words substituted by Finance Act, 2022. 
9 Expression substituted by Finance Act, 2023 
The Federal Excise Act, 2005 
 
74 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
 
by using a tobacco heating 
system without combustion  
The Federal Excise Act, 2005 
 
75 
 
     1[8d Nicotine pouches Respective 
heading 
Rupees one 
thousand and two 
hundred per kg.] 
2[9. Locally produced cigarettes 
if their on -pack printed retail 
price exceeds 3[twelve 
thousand five hundred ] 
rupees per thousand 
cigarettes. 
24.02 Rupees 4[sixteen 
thousand five 
hundred] per 
thousand cigarettes 
10. Locally produced cigarettes 
if their on -pack printed retail 
price does not exceed 5[ 
twelve thousand five 
hundred] per thousand 
cigarettes.  
24.02 Rupees 6[five 
thousand and fifty ] 
per thousand 
cigarettes] 
7[10a. ***] omitted.    
 
8[11***]   
 
 
 
 .  
12 Cigarettes manufactured by a 
manufacturer who remains 
engaged on and after the 10th 
June, 1994, either directly or 
through any other 
arrangement, if the 
manufacture of any brand of 
cigarette in non-tariff areas 
 
24.02 Sixty 9[five] 
percent of retail 
price. 
 
                         
1 New serial number 8d inserted by Finance Act, 2024.  
2 Serial numbers 9 and 10 and entries relating thereto substituted through Finance Act, 2019. 
3  Words substituted by Finance Act, 2024. 
4 Words substituted by Finance (Supplementary), Act 2023. 
5 Words substituted by Finance Act 2024. 
6 Words substituted by Finance (Supplementary), Act 2023. 
7 Serial numbers 10a and entries relating thereto omitted through Finance Act, 2019. 
8  Serial No. 11 omitted by Finance Act, 2013. 
9  Substituted for “four” by Finance Act, 2010. 
The Federal Excise Act, 2005 
 
76 
13 Portland cement, aluminous 
cement, slag cement, super 
sulphate cement and similar 
hydraulic cements, whether 
or not colored or in the form 
of clinkers  
 
25.23 
 
 
 
  
 
 1[four] rupees] per 
kilogram  
2[14, 15 and 
16***  ] 
   
    
3[17 & 18]   
 
   
4[19&20] 
 
 
   
    
5[21***] 
 
  
6[22 to 
25***] 
 
 
 
7[26to30***] 
 
   
31 Liquefied Natural Gas 2711.1100 8[ten rupees per 
Million British 
Thermal Unit 
(MMBTu)] 
32 Liquefied propone 2711.1200 Seventeen rupees 
and eighteen paisa 
per hundred cubic 
meters. 
33 Liquefied butanes 2711.1300 Seventeen rupees 
and eighteen paisa 
per hundred cubic 
                         
1  Word “two” substituted by Finance Act, 2024. 
2  Serial no. 14, 15 & 16 omitted by Finance Act, 2007. 
3  Serial no. 17 and 18 omitted by Finance Act, 2011. 
4  Serial no. 19 & 20 Omitted vide Finance Act, 2007. 
5 Sr. No. 21 omitted by Finance Act, 2011. 
6  Sr. Nos. 22 to 25 omitted by Finance Act, 2012. 
7  Sr. Nos. 26 to 30 omitted by Finance Act, 2011. Sr. No. 27 omitted by  Finance Act, 2012. 
8  The expression substituted through Finance Act, 2019. 
The Federal Excise Act, 2005 
 
77 
meters. 
 
34 Liquefied ethylene, 
propylene, butylenes and 
butadiene 
2711.1400 
 
Seventeen rupees 
and eighteen paisa 
per hundred cubic 
meters. 
35 Other Liquefied petroleum 
Gases and   gaseous 
hydrocarbons 
2711.1900 1[Rupees sixty per 
hundred metric 
tonne]. 
36 Natural Gas in gaseous state 2711.2100 2[ten rupees] per 
Million British 
Thermal Unit 
(MMBTu) 
37 Other petroleum Gases  in 
gaseous state 
2711.2900 
 
4[ten rupees]  per 
Million British 
Thermal Unit 
(MMBTu) 
3[38***]    
    
    
4[39 & 
40]  
  
     41 Flavors and concentrates for 
use in aerated beverages 
3302.1010 Fifty per cent ad 
valorem. 
 4[ 42 to 
45] 
omitted   
5[46 to 
49] 
 
omitted   
                         
1 Words substituted by Finance Act, 2022. 
2  Substituted vide Finance Act, 2010. 
3  Omitted vide Finance Act, 2007. 
4 Sr. Nos. 39 to 40 omitted by Finance Act, 2011 & Sr. Nos. 42 to 45 omitted by Finance Act, 2012. 
5  Sr. Nos. 46 47, 48 and 49 omitted by Finance Act, 2011 
The Federal Excise Act, 2005 
 
78 
 1[(53)]    
2[54 ***] omitted.   
                         
1  Sr.No. 53 omitted through Finance Act, 2016 
2  Serial number 54 and entries relating thereto omitted through Finance Act, 2019. 
The Federal Excise Act, 2005 
 
79 
 
   1[55 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2[55B 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
Imported m otor cars, SUVs and 
other motor vehicles, excluding 
auto rickshaws, principally 
designed for the transport of 
persons (other than those of 
headings 87.02),  4[and till the 
30th day of June, 2026 electric 
vehicles (4 wheelers)]  including 
station wagons and racing cars 
 
(a) of cylinder capacity up to 
1000cc 
(b) of cylinder capacity from 
1001cc            to 1799cc 
(c) of cylinder capacity 1800cc 
to 3000cc 
 
(d) of cylinder capacity 
exceeding 3001cc 
 
Locally manufactured or 
assembled motor cars, SUVs 
and other m otor vehicles, 
excluding auto rickshaws 
principally designed for the 
transport of persons (other 
than those of headings 87.02), 
and till the 30th day of June, 
2026 electric vehicles (4 
wheelers) including station 
wagons and racing cars: 
 (a) of cylinder ca pacity up to 
1300cc 
(b) of cylinder capacity from 
1301cc to 2000cc 
(c) of cylinder capacity 
2001cc and above 
 
 
 
 
87.03 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
      87.03 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.5% ad val 
6[10]% ad val. 
7[30]% ad val. 
 
 
8[40]% ad val.] 
 
 
 
 
 
 
 
 
 
 
 
 
 
 2.5 % ad val. 
 
 5% ad val.  
 
 10% ad val. 
 
 
 
 
 
                         
1  Serial number 55 and 55A and entries relating thereto substituted by Finance Act, 2019. 
2 Serial number 55B and entries relating thereto substituted by Finance (Supplementary) Act, 2022. 
The Federal Excise Act, 2005 
 
80 
1[55C 
 
 
2[55D 
 
 
 
 
 
 
 
3[56 
 
Imported double cabin (4x4) 
pick-up vehicles 
 
Locally manufactured double 
cabin (4x4) pick -up vehicles 
except the vehicles booked on 
or before the 30 th June, 2020 
subject to the restriction or 
conditions specified by the 
Board. 
 
Filter rod for cigarettes 
8704.2190 
      8704.3190 
 
 
8704.2190 
      8704.3190 
 
 
 
 
 
5[Respective 
headings] 
 
 
9[30]% ad val] 
 
 
 
 
 
10[10]% ad val.] 
 
 
 
 
11[Rupees 12[eighty 
thousand] per kg] 
13[57. 
Omitted] 
 
   
11[58. 
Omitted] 
 
   
14[59. Sugary F ruit juices, syrups 
and squashes, waters whether 
or not containing added sugar 
or artificial sweeteners 
excluding mineral and 
aerated waters 
Respective 
headings 
15[Twenty] percent of 
retail price] 
    
                                                             
4 Expression inserted by Finance Act, 2021. 
6 Expression substituted by Finance (Supplementary) Act, 2022. 
7 Expression substituted by Finance (Supplementary) Act, 2022. 
8 Expression substituted by Finance (Supplementary) Act, 2022. 
1   New serial number 55C inserted by Finance Act, 2020. 
2   New serial number 55D inserted by Finance Act, 2020. 
3  Serial number 56 and entries relating thereto in column (2), (3) and (4) added by Finance Act, 2015. 
5  Words substituted by Finance Act, 2022. 
9 Expression substituted by Finance (Supplementary) Act, 2022. 
10 Expression substituted by Finance (Supplementary) Act, 2022. 
11 Expression substituted by Finance Act, 2022. 
12 Word “fifteen hundred” substituted by Finance Act, 2024. 
13 Serial numbers 57, 58 and entries relating thereto omitted through Finance Act, 2021. 
14 New serial number 59 added by Finance (Supplementary) Act, 2023. 
15 For the word “ten” the word “twenty” substituted by Finance Act, 2023 
The Federal Excise Act, 2005 
 
81 
    
1[60 Energy inefficient fans both 
locally manufac tured and 
imported which do not 
comply with the MEPS, 
notified by PSQCA 
Respective 
heading 
Rupees two thousand 
per fan with effect 
from the 1st day of 
January, 2024 
    
61 Incandescent bulbs both 
locally manufactured and 
imported 
8539.2200 and 
8539.2990 
Twenty percent ad 
valorem with effect 
from the 1st day of 
January, 2024 
    
62 Fertilizers Respective 
heading 
Five percent ad 
valorem.] 
    
2[63 Lubricating oil 2710.1951, 
2710.1952 and 
2710.1953 
Five percent ad 
valorem.] 
3[64 Day Old Chick (DOC) Respective 
Heading 
Rs.10 
Per DOC] 
 Interpretation.–– (1) Unless the intent appears otherwise, for the 
purpose of levy of duty of excise, the description of goods shall prevail 
upon the tariff classification. However in order for interpretation of 
description of any goods or verification of any characteristics of any 
product, the reliance shall be made on the relevant version of the 
Explanatory Notes to the Harmonized Commodity Description and Coding 
System. 
 (2) The rate of duty mentioned in column (4) of the above table 
shall also apply on the goods mentioned in column (2) thereof, if imported, 
or brought from non-tariff to tariff areas in case of notified goods. 
 4[Restriction-1– Reduction.– For the purpose of levy, collection 
                         
1  New serial numbers 60 to 62 inserted by Finance Act, 2023. 
2 New serial numbers 63 inserted by Finance Act, 2024. 
3 Serial number 64 inserted by Finance Act, 2025. 
4  Restriction-1 & Restriction-3 substituted by Finance Act, 2017 
The Federal Excise Act, 2005 
 
82 
and payment of duty at the rates  specified in column (4) against serial 
number 9  1[and 10] , no cigarette manufacturer shall reduce retail price 
from the level adopted on the day of the announcement of the latest 
budget]. 
 
 2[(2) Restriction-2 – Brand variants at different price points ].– 
No manufacturer or importer of cigarette can introduce or sell a new 
cigarette brand variant at the same existing brand family at a price lower 
than the lowest actual price of the existing variant of the same brand 
family. For the purposes of this restric tion, current minimum price variant 
of existing brand means the lowest price of a brand variant on the day of 
announcement of Budget 3[of the current Financial year] 4[] 
 
  [Explanation.– For the purpose of this restriction, brand 
variant means any cigarette brand with similar logo, name, colour, design, 
pattern or any unique distinguishing mark associated with an existing 
brand family.]  
 
 1[(3) Restriction-3 – Minimum price. –  No brand shall be priced 
and sold at a retail price (excluding sales tax) lower than 5[fifty five] percent of 
the retail price under column (2) against serial number 9 of Table-I of the First 
Schedule to this Act.] 
 
 6[(4) Rate of Duty - Notwithstanding the limitation on the retail price 
under column (2) against serial number 9, manufacturers whose brands were 
liable to duty at the rates specified in column (4) against serial number 9, one 
day before the date of amendment (through a notification, an ordinance or an 
act of parliament), shall continue to collect and pay the duty agains t serial 
number 9 at the amended rates specified in column (4) (through a notification, 
an ordinance or an act of parliament)]. 
                         
1  The words added through Finance Act, 2019. 
2 Marginal heading substituted by Finance Act, 2024. 
3  Words substituted by Finance Act, 2014. 
4  For full stop at the end, explanation added by Finance Act, 2024. 
5  Word ‘sixty’ substituted by Finance Act, 2024. 
6 Expression added by Finance (Supplementary) Act, 2023. 
The Federal Excise Act, 2005 
 
83 
TABLE II 
(EXCISABLE SERVICES) 
 
S.No. Description of 1[Services] Heading/sub-
heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
1 Advertisement on closed 
circuit T.V. 
9802.3000 
 
Sixteen per cent of 
the charges. 
2 Advertisements on cable T.V. 
network. 
9802.5000 
 
Sixteen per cent of 
the charges. 
2a 2[Advertisements in news 
papers  and periodicals 
(excluding and           
Classified advertisements) of 
hoarding boards, poles Signs 
and sign boards.                     
9802.4000 
and 
9802.9000 
Sixteen per cent of 
the charges.] 
3 3[Facilities for travel 
 
(a)  Services provided or 
rendered in respect  of 
travel by air of 
passengers within the 
territorial jurisdiction of 
Pakistan 
 
4[(i)   Long routes 
 
(ii)  Short routes 
 
 
5[(iii) * * *] 
 
Explanation: For the 
purpose of this entry, 
“Long routes” means 
journeys exceeding 500 
kilometers, short routes 
98.03 
 
9803.1000 
 
 
 
 
 
 
 
 
 
 
 2[Fifteen Hundred] 
 rupees 
 
3[Nine Hundred] 
rupees 
 
 
 
                         
1 Words substituted by Finance Act, 2021. 
2 Inserted vide Finance Act, 2009. 
3  Inserted by Finance Act, 2014. 
4  Inserted by Finance Act, 2014 
5  Sub-clause (iii) and entry relating thereto in column (4) omitted by Finance Act, 2015. 
The Federal Excise Act, 2005 
 
84 
S.No. Description of 1[Services] Heading/sub-
heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
means the remaining 
journeys, o ther than 
socio-economic route 
1[as defined in S. No. 9 
of Table II of the Third 
Schedule]. Routes 
exempt from duty as on 
1st July, 2014 shall, 
however, remain exempt. 
 
4[(b)  Services provided 
or rendered in respect of 
travel by air of 
passengers embarking on 
international journey  
from Pakistan,– 
[(i) Economy and 
economy plus air tickets 
issued on or after the 1st 
day of July, 2024.  
[(ii) Club, business and 
first class air tickets 
issued on or after the 1st 
day of July, 2024: 
 
 
 
 
 
 
 
 
 
Twelve thousand 
five hundred rupees 
 
 
 
 
 
(a) IATA Traffic Conference 
Area 1  (North, Central, 
South America and 
Environs) 
 
 
       (b) IATA Traffic 
Conference Area 2  
  
(a) Three hundred and 
fifty thousand rupees 
 
 
 
 
 
                                                             
2  The figures substituted through Finance Act, 2019. 
3 The figures substituted through Finance Act, 2019. 
1  Substituted for the expression “, and “socio-economic routes” means journeys along the Baluchistan coastal 
belt” by     Finance Act, 2015. 
4  Serial number 3(b) substituted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
85 
S.No. Description of 1[Services] Heading/sub-
heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
(I) Middle East  
and Africa 
  
 
(II) Europe 
 
 
 
  (c) IATA Traffic   
 Conference Area 3 
 (Far East, Australia, New 
 Zealand and Pacific 
 Islands) 
 
(b)(I) One hundred 
and five thousand 
rupees 
 
(b)((II) Two hundred 
and ten thousand 
rupees 
 
(c) Two hundred and 
ten thousand rupees] 
 
 
4 Inland carriage of goods by air 9804.1000 3[Sixteen] per cent 
of the charges. 
 
5 
 
Shipping agents 
 
9805.1000 
 
(i) Two hundred 
rupees per house -
bill of lading 
issued in case of 
Non-Vessel 
Operating  
Common Ca rriers 
(NVOCC), 
International Freight 
   ii) 1[sixteen] per 
cent of the charges 
in case of other 
categories of 
shipping agents. 
 
2[6 
 
Telecommunication services  
3[, excluding such services in 
the area of a Province where 
such Province has imposed 
 
98.12 
(All sub 
headings ) 
 
 4[nineteen and half] 
per cent of charges 
                         
1 Substituted vide Finance Act, 2008. 
2  Serial no. 6 substituted by Finance Act, 2008. 
3  Comma and words added by Finance Act, 2014. 
4 For the word “sixteen” the word “nineteen and half” substituted by Finance Act, 2022. 
The Federal Excise Act, 2005 
 
86 
S.No. Description of 1[Services] Heading/sub-
heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
Provincial sales tax and has 
started collecting the same 
through its own Board or 
Authority, as the case may 
be.] 
 
 
 
 
1[6A 
 
 
 
 
 
 
 
 
2[ 7*** 
] 
Following 
telecommunication 
services: 
Mobile phone call, if call 
duration exceeds five 
minutes; 
Respective 
sub-heading 
of 98.12 
Seventy five paisa 
per call in addition 
to the rates of duty 
specified under 
Serial No.6] 
38 Services provided or 
rendered by banking 
companies 4[excluding 
Merchant Discount Rate  
(MDR) for accepting 
digital payment] , insurance 
companies, cooperative 
financing  societies, 
modarabas , musharikas, 
leasing companies, foreign 
exchange dealers, non -
banking financial 
institutions, Assets 
Management Companies 
98.13 Sixteen percent of 
the charges.] 
                         
1 New serial number 6A and entries relating thereto inserted by Finance Act, 2021. 
2  Serial No. 7 and entries relating thereto omitted by Finance Act, 2013. 
3  Serial no. 8 substituted by Finance Act, 2013. 
4 Words inserted by Finance Act, 2021. 
The Federal Excise Act, 2005 
 
87 
S.No. Description of 1[Services] Heading/sub-
heading 
Number 
Rate of Duty 
 
Col.(1) Col.(2) Col.(3) Col.(4) 
and other persons dealing 
in any such services. 
1[9 & 
10*** ] 
   
    
2[11 Franchise services, royalty and 
fee for technical services 
Respective 
heading 
Ten per cent of the 
charges.] 
3[ 12** 
] 
   
4[13 Services provided or rendered 
by stock brokers 
9819.1000 Sixteen percent of 
the charges.] 
 
5[14 
 
Services provided or 
rendered by port and terminal 
operators in relation to 
imports excluding 
stevedoring services. 
 
9819.9090 
 
Sixteen percent of 
the charges.] 
 
6[15 
 
Chartered flights 
 
98.03 
 
Sixteen percent of 
the charges] 
 
 7[Note.– The duty on the services as specified against serial 
numbers 1, 2, 2A, 5, 8, 11 and 13 shall not be levied on services provided 
in a Province where the provincial sales tax has been levied thereon]. 
 
 
 
 
 
                         
1  Serial Nos. 9 & 10 Omitted vide Finance Act, 2007 
2  Serial no. 11 substituted by Finance Act, 2023 
3  Serial No. 12 omitted by Finance Act, 2011. 
4  Inserted vide Finance Act, 2009. 
5  Inserted vide Finance Act, 2009. 
6  Serial no. 15 inserted by Finance Act, 2014. 
7  Note inserted through Finance Act, 2016. 
The Federal Excise Act, 2005 
 
88 
1[TABLE III 
 
(EXCISABLE ITEMS OTHER THAN THOSE MENTIONED UNDER 
TABLE-I AND TABLE-II)) 
[See clause (e) of sub-section (1) of section 3] 
 
S.No. Description of Items Heading/sub-
heading 
Number 
Rate of Duty 
 
    
(1) (2) (3) (4) 
 
1 2[Omitted.]   
    
2 Supply of white  crystalline 
sugar by any person to a 
manufacturing, processing or 
packaging entity.”. 
Respective 
heading 
Rupees fifteen per 
kg.] 
 
                         
1 Table-III inserted by Finance Act, 2024. 
2 Serial No. 1 omitted by Finance Act, 2025. 
 
The Federal Excise Act, 2005 
 
89 
SECOND SCHEDULE 
 
(Goods on which duty is collectible under sales tax mode with entitlement 
for adjustment with sales tax and vice versa) 
[See section 7] 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
1 2 3 
 
1(1) 
 
[omitted] 
 
 
3(2) 
 
[omitted] 
 
 
2[(3)***] 
 
 
 
 
 3[(4) [omitted]  
 
                         
1 Serial numbers 1,2 and 4 omitted by Finance Act, 2021. 
2  Serial number 3 omitted through Finance Act, 2016 
The Federal Excise Act, 2005 
 
90 
THIRD SCHEDULE 
(Conditional exemptions)  
[See Sub-section (1) of section 16] 
 
TABLE-I 
(Goods) 
 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
 
(1) 
 
Crude vegetable oil, if obtained from the locally 
grown see ds excluding cooking oil, without 
having undergone any process other than the 
process of washing. 
 
5.07, 15.08, 
15.09, 15010, 
15.11, 15.12, 
15.13, 15.14 
15.15, 15.16, 
15.17 & 15.18 
 
1[2  
***] 
  
 
(3) 
 
Un-manufactured tobacco or tobacco refuses if 
used for the purposes other than the manufacturer 
of cigarettes, smoking mixtures for pipes and 
cigarettes and cigars and cheroots. 
 
24.01 
 
2[3A ** 
3B** ] 
  
   
(4) Cigars, cheroots, cigarillos and cigarettes, of 
tobacco or of tobacco substitutes,- 
 
24.02 
 (i) If supplied to Pakistan Navy for consumption 
by its personnel on board its vessels. 
 
(ii) If made by hand in tapered shape of biris 
without the  use of any manual or power -
operated machine in any process of their 
manufacture. 
 
  
                         
1 Omitted vide Finance Act, 2007. 
2  Omitted vide Finance Act, 2008. 
The Federal Excise Act, 2005 
 
91 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
(iii)  If supplied for consumption by the President 
of Pakistan, the President of Azad Jammu & 
Kashmir and the Governors of the Provinces, 
members of their familie s and guests 
provided that the cigarettes are manufactured 
and supplied on the specific written orders of 
the competent official authority and the 
cigarettes and their packets are special-crested 
for the respective privileged House. 
 
(iv) If supplied ag ainst payment in foreign 
exchange, to M/s Duty Free Shops Ltd for 
sale in its Duty Free Shops and on board 
international flight by the Pakistan 
International Airlines subject to the same 
conditions and procedures as are applicable 
for the purposes of exemp tion of customs 
duty. 
 
1[5 ***] 
 
 
 
6 Motor spirit,– 2710.1110 
(i)  If supplied to Pakistan Navy for consumption 
in its vessels 
(ii) If supplied for consumption by the 
International Bank for Reconstruction and 
Development in its official cars 
2710.1110 
 
2[7** 
8** ] 
  
   
 
9 Sludge and sediment recovered from storage tanks 
of the   incoming vessels or ships meant for 
breaking 
 
 
2710.9900 
                         
1  Omitted vide Finance Act, 2013. 
2 Omitted vide Finance Act, 2013. 
The Federal Excise Act, 2005 
 
92 
S.No. Description of Goods Heading/ 
sub-heading 
Number 
10 Natural gas if produced and used in the same field 
for drilling,   production, pressure maintenance or 
in any other  joint operations including flaring in 
the same field. 
2711.2100 
 Explanation.- For the purpose of this entry, "Joint Operations" means all 
marine and land activities, including gas exploration, prospection, development 
and production activities conducted  by Working Interest Owners under a  
petroleum concession agreement with the Government. 
 
   
 
11 Carbon black oil (carbon black feed stock) if 
imported by 1[a duly registered manufacturer of 
carbon black]. 
 
2707.9910 
2713.9010 
 
Goods,- 
 
 
12 (i) If donated to the President's Funds for Afghan 
Refugees, Assistance to Palestine and Famine 
Relief for Africa, provided that before making such 
donation the manufacturer or importer shall 
inform in writing to the Collector of Federal 
Excise or as the case may be, C ollector of 
Customs about quantity, value and the duty 
involved on such goods and shall in case of 
imports, fulfill the conditions and comply with the 
procedures specified for the purposes of 
exemption from customs duty. 
(ii) If purchased by the Cabinet Di vision, 
Government of Pakistan, for donation to a 
foreign country in the event of natural disasters 
as certified by the Emergency Relief Cell of 
that Division. 
 
(iii) If supplied   against   international   tender   
issued   by UNICEF,  UNDP,  WHO,  WFP,  
 
Respective  
headings 
 
 
 
 
 
 
 
 
 
 
 
 
                         
1  Substituted for “National Petrocarbon (Pvt.) Limited, Pipri, Karachi as raw material for the manufacture of 
the carbon black” by Finance Act, 2008. 
The Federal Excise Act, 2005 
 
93 
   
UNHCR,  International  Red Cross or any other 
relief agency, for Afghan Refugees subject to 
the conditions given below, namely,- 
(
(a) payment for the supply shall be received in 
foreign currency, which shall be surrendered to 
the State Bank of Pakistan and the supplier shall 
receive payment in Pak rupees as per State Bank 
procedure and foreign exchange regulations; 
(b) the goods shall be duly received by the 
organization which signed the contract, and a 
certificate to this effect shall be issued by the 
organization which shall be duly attested by the 
Chief Commissioner/ Commissioner of Afghan 
Refugees and will be submitted by the 
manufacturer to the 1[Commissioner] of Federal 
excise; and 
(c) the registered person shall retain the 
relevant documents and certificates in record. 
(iv) If supplied as ship stores to ships and 
aircrafts leaving for abroad subject to the 
satisfaction of the Collector of Customs in terms 
of section 24 of the Customs Act, 1969. 
 
13 Goods imported or supplied under grants -in-aid 
for which a specific consent has been obtained 
from the 2[Board]. 
 
Respective 
Heading 
                         
1 Substituted for “Collector” by Finance Act, 2010 w.e.f. June 5, 2010. The same amendment was made by 
Finance (Amendment) Ordinance, 2010, promulgated as Ordinance No. III of 2010, dated February 6, 2010, 
published in the Gazette of Pakistan Extraordinary Part I at pages 23 to 53. This Ordinance was presented in 
the Parliament but lapsed on 5 June 2010 as Parliament did not approve it. Originally this amendment was 
made through Finance (Amendment) Ordinance, 2009, promulgated as Ordinance No. XXII of 2009, dated 
October 28, 2009, published in the Gazette of Pakistan Extraordinary Part I at pages 229 to 259. 
2  Substituted vide Finance Act, 2007. 
The Federal Excise Act, 2005 
 
94 
   
14 
 
 
15 
Goods if imported as bonafide baggage 
 
Goods if imported by Duty Free Shops as baggage 
free of   custom  duty,  regulatory  duty  and  sales  
tax  under  the   baggage rules made under the 
Customs Act, 1969 (IV of 1969). 
Respective 
Heading 
 
Respective  
Heading 
 
 
 
 
16 Any goods 1[,excluding un -manufactured 
tobacco,] which are manufactured produced in -
house by a   registered   person   and   use d   for   
the   manufacture   and   production of goods on 
which duty of excise is paid by such     person. 
2[omitted] 
 
 
Respective 
Headings. 
 
217 
 
 
3[18***
] 
Goods for further manufacture of goods in the 
Export Processing Zones 
 
 
Respective 
Headings. 
 
4[19 Materials and equipment 5[(plant, machinery, 
equipment, appliances and accessories)] for 
construction and operation of 6[Gwadar] Port and 
development of Free Zone for 3[Gwadar] Port as 
imported by or supplied to China Overseas Ports 
Holding Company Limi ted (COPHCL) and its 
operating companies namely (i) China Overseas 
Ports Holding Company Pakistan (Private) 
Limited, (ii) Gwadar International Terminals 
Limited, (iii) Gwadar Marine Services Limited 
and (iv) Gwadar Free Zone Company Limited, 
their contract ors and sub -contractors; and Ship 
Bunker Oils bought and sold to the ships calling 
on/visiting 3[Gwadar] Port, having Concession 
Agreement with the Gwadar Port Authority, for a 
period of forty years, subject to the conditions and 
procedure as specified und er S.  No. 100A of 
Respective 
Headings 
                         
1  Expression inserted and Explanation omitted by Finance Supplementary (Amendment)Act,2018. 
2  Inserted vide Finance Act, 2008. 
3  Serial number 18 omitted through Finance Act, 2016. 
4  New serial number 19 added through Finance Act, 2016. 
5  The expression inserted by Finance Act, 2017. 
6  The word “Gwadar” substituted for the word “Gawadar” by Finance Act, 2017. 
The Federal Excise Act, 2005 
 
95 
   
Table-1 of Sixth Schedule to the Sales Tax Act, 
1990. 
 
1[20 Supplies made by the businesses to be established 
in the Gwadar Free Zone for a period of twenty -
three years within the Gwadar Free Zone, subject 
to the condition that the sales and supplies outside 
the Gwadar Free Zone and into the territory of 
Pakistan shall be subjected to Federal Excise 
Duty. 
 
Respective 
Headings”; and 
2[21 Vehicles imported by China Overseas Ports 
Holding Company Limited (COPHCL) and its  
operating companies, namely:–  
 (a) China Overseas Ports Holding Company 
Pakistan (Private) Limited; 
 (b) Gwadar International Terminal Limited; 
 (c) Gwadar Marine Services Limited; and  
 (d) Gwadar Free Zone Company Limited; 
for a period of twenty-three years for construction, 
development and operations of Gwadar Port and 
Free Zone Area subject to limitations, conditions 
prescribed under PCT heading 9917 (3). 
 
Respective 
Headings] 
3[22 Equipment imported by M/s China Railway 
Corporation to be furnished a nd installed in 
Lahore Orange Line Metro Train Project 
subject to the following conditions: 
(a) that the equipment imported under this 
serial number shall only be used in the 
aforesaid Project;   
(b) that the importer shall furnish an 
indemnity bond, in the prescribed manner and 
format as set out in Annex -A to this serial 
number, at the time of import to the extent of 
federal excise duty exempted under this serial 
number on consignment to consignment basis; 
 
                         
1 New serial number 20 added through Finance Act, 2016. 
2  New serial number 21 added by Finance Act, 2017 
3  New serial number 22 added by Finance Act, 2018. 
The Federal Excise Act, 2005 
 
96 
   
(c) that the Punjab Mass Transit 
Authority, established under the Punjab Mass 
Transit Authority Act, 2015 (ACT XXXIII of 
2015), hereinafter referred as the Regulatory 
Authority, shall certify in the prescribed 
manner and format as set out in Annex -B to 
this serial number that the imported 
equipment is bona fide  requirement of the 
Project under the Contract No. PMA -CR-
NORINCO-OL, dated 20.04.2015, hereafter 
referred as the contract, signed between the 
Regulatory Authority and CR-NORINCO; 
(d) in the event a dispute arises whether 
any item is entitled to exem ption under this 
serial number, the item shall be immediately 
released by the Customs Department against a 
corporate guarantee, valid for a period of six 
months, submitted by the importer. A 
certificate from the Regulatory Authority duly 
verified by the Tr ansport and Communication 
Section of the Ministry of Planning, 
Development and Reform, that the item is 
covered under this serial number shall be 
given due consideration by the Customs 
Department towards finally resolving the 
dispute; 
(e) for the clearance  of imported 
equipment through Pakistan Customs 
Computerized System the authorized officer 
of the Regulatory Authority  shall furnish all 
relevant information, as set out in Annex -B to 
this serial number, online against a specific 
user ID and password obta ined under section 
155D of the Customs Act, 1969 (IV of 1969). 
In Collectorates or Customs stations where 
the Pakistan Customs Computerized System 
is not operational, the Director Reforms and 
Automation or any other person authorized by 
The Federal Excise Act, 2005 
 
97 
   
the Collector in th is behalf shall enter the 
requisite information in the Pakistan Customs 
Computerized System on daily basis,  
whereas entry of the data obtained from the 
customs stations which have not yet been 
computerized shall be made on weekly basis; 
(f) that the equip ment, imported under 
this serial number, shall not be re -exported, 
sold or otherwise disposed of without prior 
approval of the Federal Board of Revenue 
(FBR). In case goods are sold or otherwise 
disposed of with prior approval of FBR the 
same shall be subj ect to payment of federal 
excise duty as may be prescribed by the FBR; 
(g) in case the equipment, imported under 
this serial number, is sold or otherwise 
disposed of without prior approval of the FBR 
in terms of condition (f), the same shall be 
subject to payment of statutory rates of 
federal excise duty as were applicable at the 
time of import; 
(h) notwithstanding the condition (f) and 
(g), equipment imported under this serial 
number may be surrendered at any time to the 
Collector of Customs having jurisdi ction, 
without payment of any federal excise duty, 
for further disposal as may be prescribed by 
the FBR; 
(i) the indemnity bond submitted in terms 
of condition (b) above shall stand discharged 
on submission of a certificate from the 
Regulatory Authority to  the effect that the 
equipment has been installed or consumed in 
the said Project. In case the equipment is not 
consumed or installed in the project the 
indemnity bond shall be discharged on 
fulfillment of conditions stipulated at (f) or  
(g) or (h), as the case may be; and 
The Federal Excise Act, 2005 
 
98 
   
(j) that violation of any of the above 
conditions shall render the goods liable to 
payment of statutory rate of federal excise 
duty leviable on the date of clearance of 
goods in addition to any other penal action 
under relevant provisions of the law. 
Explanation. For the purpose of this 
provisions, “equipment” shall mean 
machinery, apparatus, materials and all things 
to be provided under the contract for 
incorporation in the works relating to Lahore 
Orange Line Metro Train Project. 
 
1[23 Imports made by diplomats, diplomatic 
missions, privileged persons and privileged 
organizations which are covered under 
various Acts, Orders, Rules, Regulations and 
Agreements passed by the Parliament or 
issued or agreed by the Government of 
Pakistan. 
99.01, 99.02 
and 99.05.] 
   
   
   
   
   
   
   
                         
1 New serial number 23 and entries relating thereto inserted by Finance Act, 2024. 
The Federal Excise Act, 2005 
 
99 
1[Annex-A 
[See condition (b)] 
 
INDEMNITY BOND 
 
(On appropriately stamp non -judicial paper attested by a Government 
servant in BPS 17 or above, an Oath Commissioner, a Notary Public or an 
officer of a Scheduled Bank) 
THIS DEED OF INDEMNITY is made on the _________ date of 
__________BETWEEN Messrs___________ having registered office at 
_________ (hereinafter called "the importers" which means and includes 
their successors, administrators, executors and assi gnees) of the one part, 
and the President of the Islamic Republic of Pakistan through the 
Collector of Customs _________ (hereinafter called the "Collector of 
Customs"), of the other part.  
WHEREAS the Federal Government, by its decision contained in 
serial number 22 of this table and subject to the conditions thereof, has 
been pleased to direct that such equipment shall be exempt from the whole 
of federal excise duty leviable thereon, in accordance with the said serial 
number 22, if imported for Lahore Orange Line Metro Train Project.  
AND WHEREAS M/S.____________, the importers have 
imported the equipment mentioned in the said serial number for the above 
mentioned project in accordance with the conditions given in the said 
serial number 22;  
NOW, THEREFORE , in consideration of the release of the 
equipment without recovery of leviable federal excise duty, the importers 
bind themselves to pay on demand to the Government of Pakistan the sum 
of Rs. __________ being the federal excise duty and charges leviable o n 
the equipment, if the importers fail to fulfill the condition (f) or (g) or (h) 
of the said serial number 22, as the case may be.  
The importers further agree and bind themselves that the amount 
covered by this Indemnity Bond shall be recovered as arrear s of federal 
excise duty under section 202 of the Customs Act, 1969. This Bond shall 
stand revoked automatically when the Collector of Customs is satisfied 
that the importers have fulfilled all the conditions of the said serial number 22. 
Signed by importe rs on this ____________________ day of 
_______________________201_. 
Managing Director or person next 
                         
1  Annex “A” & “B” added by Finance Act, 2018. 
The Federal Excise Act, 2005 
 
100 
in hierarchy duly authorized by MD 
(Name and permanent address) 
Collector of Customs 
(On behalf of President)  
Witness (1) ________________________________________________ 
(signature, name, designation and full address)  
Witness (2)  ________________________________________________ 
(signature, name, designation and full address) 
 
1[Annex-B 
[See conditions (c) and (e)] 
NTN or FTN of Importer Approval No. 
Details of equipment (to be filled by the authorized officer of the Regulatory 
Authority) to be imported 
Description 
and 
specifications. 
Quantity/UOM 
L/C No. or 
bank contract 
No. and B/L. 
IGM No. 
Date & 
Index No. 
Remarks, 
if any. 
(1) (2) (3) (4) (5) 
CERTIFICATE BY THE AUTHORIZED OFFICER OF 
REGULATORY AUTHORITY:  It is hereby certified that the 
description, quantity and other details mentioned above are true 
and correct. Goods imported are in commensuration with the 
project requirements and are bona fide requirement of the Project 
under the Contract. It is further certified that the above items shall 
not be used for any other purpose except for the Project.  
Signature:   __________________________ 
Name and Designation: __________________________ 
Official Stamp:  __________________________ 
Date:   __________________________ 
The Federal Excise Act, 2005 
 
101 
 
   
1[24 The following goods, when supplied within 
the limits of the Border Sustenance Markets, 
established in cooperation with Iran and 
Afghanistan: 
 
 (i)  Animal Fats and Oil and their fractions 1516.1000 
 (ii)  Vegetable Fats and their fractions 1516.2010 
 (iii) Vegetable Oils and their fractions 1516.2020 
 Provided that, such items in case of import, 
shall be allowed clearance by the Customs 
Authorities subject to furnishing of ban k 
guarantee equal to the amount of duty 
involved and the same shall be released after 
presentation of consumption certificate issued 
by the Commissioner Inland Revenue having 
jurisdiction: 
Provided further that, the said exemption shall 
only be available t o a person upon furnishing 
proof of having a functional business 
premises located within limits of the Border 
Sustenance Markets. 
 
25. Import and supply of raw materials, 
components, parts and plant and machinery 
by registered persons authorized under Exp ort 
Facilitation Scheme, 2021 notified by the 
Board with such conditions, limitations and 
restrictions.” 
Respective 
headings] 
   
2[26 Imports or supplies made by, for or to a 
qualified investment as specified at Serial 
No.1 of the First Schedule to the F oreign 
Investment (Promotion and Protection) Act, 
2022 for the period as specified in the Second 
Schedule to the said Act. 
Respective 
heading.] 
                         
1 New serial numbers 24 and 25 inserted by Finance Act, 2021. 
2 New serial number added by Finance Act, 2023 
The Federal Excise Act, 2005 
 
102 
1[27 Imported construction materials and goods 
imported by M/s China State Construction 
Engineering Corporation  Limited (M/s 
CSCECL), whether or not locally 
manufactured, for construction of Karachi -
Peshawar Motorway (Sukkur-Multan Section) 
subject to fulfilment of same conditions, 
limitations and restrictions as are specified 
under S. No. 145 of Table-1 of Sixth Schedule 
to the Sales Tax Act, 1990, provided that total 
incidence of exemptions of all duties and 
taxes in respect of construction materials and 
goods imported for the project shall not 
exceed ten thousand eight hundred ninety -
eight million rupees includin g the benefit of 
exemption from duties and taxes availed 
before 30th June, 2018 under the provisions of 
Sales Tax Act, 1990, the Customs Act, 1969, 
The Federal Excise Act 2005 and the Income 
Tax Ordinance, 2001 and the notifications 
issued thereunder. 
 
 
Respective 
headings 
                         
1  S. No. 23 occurring for the second time re-numbered as S. No. 27 by Finance Act, 2025. 
The Federal Excise Act, 2005 
 
103 
TABLE-II 
 
S. No. Description of Services Heading/ 
sub-heading 
Number 
Col.(1) Col.(2) Col.(3) 
1 Advertisements financed out of funds provided under 
grants-in- aid agreements. 
Respective 
heading 
1[2 Telecommunication services: 
2[(i)  ***] omitted. 
 
(ii) Such charges payable on the international 
leased lines or bandwidth services  3[, 
excluding those provided by foreign satellite 
companies,] used by— 
 
(a) software exporting firms registered 
with the Pakistan Software Exporting Board; 
and  
 
(b) data an d 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 agr eements with the foreign 
telecommunication companies. 
Respective sub- 
heading of 
Heading 98.02 
 
 
 
 
 
 
 
 
 
3 Marine insurance for export.                                                9813.1000 
4[4 Life insurance 9813.1500 
5 Health insurance 9813.1600 
6 Crop insurance 9813.1600] 
5[7 Live stock insurance 9813.1600] 
6[8 ***]  
                         
1 Substituted vide Finance Act, 2006. 
2  Clause (i) omitted through Finance Act, 2019. 
3  The expression added through Finance Act, 2019. 
4  Added vide Finance Act, 2008. 
5  Inserted vide Finance Act, 2012. 
6  Serial number 8 and entries relating thereto omitted by Finance Act, 2013 
The Federal Excise Act, 2005 
 
104 
S. No. Description of Services Heading/ 
sub-heading 
Number 
Col.(1) Col.(2) Col.(3) 
1[9 Services provided or rendered in respect of travel by 
air of passengers on “socio economic routes”, which 
means the shortest part of journeys starting from or 
ending at an airpo rt located in Makran coastal 
region, FATA, Azad Jammu and Kashmir, Gilgit -
Baltistan or Chitral 
 
98.03 
10 Services provided or rendered in respect of travel by 
air of passengers on international journeys from 
Pakistan to: 
(a) Hajj passengers; 
(b) Diplomats; and  
(c) Supernumerary crew 
 
9803.1000 
11 Advertisements in newspapers and periodicals 
 
9802.4000 
12 Services provided or rendered by banking 
companies and non-banking financial companies in 
respect of Hajj and Umrah, cheque book, insurance, 
Musharika and Modaraba financing and utility bill 
collection. 
 
98.13] 
2[13 Chartered flight services used by or for armed forces 
to move troops and equipment deployed locally or 
internationally, including those for movement of 
troops and equipment to UN missions. 
 
98.03] 
3[14 Commission paid by State Bank of Pakistan and its 
subsidiaries to National Bank of Pakistan or any 
other banking company for handling banking 
services of Federal or Provincial Governments as 
State Bank of Pakistan’s agents. 
Respective 
heading] 
 
 
  
                         
1  Serial number 9, 10, 11 & 12 and entries relating thereto added by Finance Act, 2015 
2  Serial number 13 and entries relating thereto added by Finance Act, 2016 
3  Serial number 14 and entries relating thereto added by Finance Act, 2018 
The Federal Excise Act, 2005 
 
105 
S. No. Description of Services Heading/ 
sub-heading 
Number 
Col.(1) Col.(2) Col.(3) 
1[15 Services provided or rendered by, for or to a 
qualified investment as specified at Serial No.1 of 
the First Schedule to the Foreign Investment 
(Promotion and Protection) Act, 2022 for the period 
as specified in the Second Schedule to the said Act. 
Respective 
heading.] 
  
2[FOURTH SCHEDULE] 
[Omitted] 
 
PCPPI—4311(19)FBR—24-09-2019—2,000 Copies.   
                         
1 New serial number added by Finance Act, 2023 
2 Fourth Schedule omitted by Finance Act, 2021.

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Follow the instruments and provisions named in this source edition, and the laws that cite it. Citation links identify the text being referred to; legal effect and current force require separate examination.

11 citations to other instruments0 citations from other laws79 internal provision references16 explicit external provision references

Instruments cited by this law 5

Code of Criminal Procedure (CrPC), 1898 (Under Review)

Cites this instrument · 6 occurrences

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d all cases pending in any other court in such area immediate ly before such appointment shall stand transferred to such Special Judge. (2) The provisions of the Code of Criminal Procedure, 1898 (Act V of 1898), except those of Chapter XXXVIII of that Code, shall apply to the proceedings of the court of a Special Judge and, for the purposes of the said provisions, the court of a Special Judge shall be deemed to be

Federal Excise Act, 2005 (Same as on the official website of FBR dated 30-06-2025)

Section 1. Short title, extent and commencement

Section 2. Definitions

CHAPTER II

Section 3. Duties specified in the First Schedule to be levied

Section 4. Filing of return and payment of duty etc

Section 5. Zero rate of duty and drawback of duty etc

Section 6. Adjustment of duties of excise

Section 7. Application of the provisions of the Sales Tax Act, 1990

[4] Section 8. Default surcharge

Section 9. Liability for payment of duty in the case of private companies or business ente rprises or in case of sale of business ownership

Section 10. Applicable value and rate of duty

Section 11. Collection of excess duty etc

Section 12. Determination of value for the purposes of duty

Section 13. Registration

Section 14. Recovery of unpaid duty or of erroneously refunded duty or arrears of duty, etc

[2] Section 14A. Short paid amounts recoverable

[3] Section 14B. Assessment giving effect to an order

[1] Section 14C. Power of tax authorities to modify orders, etc

Section 15. Application of the Customs Act, 1969 (IV of 1969) to Federal excise duties

Section 16. Exemptions

Section 17. Records

Section 18. Invoices

CHAPTER III

Section 19. Offences, penalties, fines and al lied matters

Section 20. Appointment of Special Judges for trial of offences

Section 21. Trial of offences by Special Judge

[1] Section 21A. Appeal against the order of Special Judge

Section 22. Power to arrest and prosecute

Section 23. Power to summon persons to give evidence and produce documents in inquiries

Section 24. Officers required to assist 1[officer of Inlan d Revenue]

CHAPTER IV

Section 25. Searches and arrests how to be made

Section 26. Power to seize

Section 27. Confiscation 3[of goods subject to federal excise duty]

Section 28. Power to release seized conveyance

CHAPTER V

Section 29. Appointment of Federal excise officers and delegation of powers

[5] Section 29A. Tax Fraud Investigation Wing Inland Revenue

Section 30. Use of powers of subordinate officer

Section 32. Option to pay fine in lieu of confiscation of conveyance

Section 33. Appeals to 3[Commissioner] (Appeals)

[7] Section 33A. Omitted

Section 34. Appeals to the Appellate Tribunal 1[***]

[5] Section 34A. Reference to the High Court

[7] Section 34AB. Saving

Section 35. Powers of Board or 1[Commissioner] to pass certain orders

Section 36. Power to rectify mistakes in orders

Section 37. Deposit, pending appeal, of duty demanded or penalty levied

[3] Section 38. Alternative dispute resolution

Section 39. Exclusion of time taken for copy

CHAPTER VI

Section 40. Power of Board to make rules

Section 41. Bar of suit and limitation of suit and other legal proceedings

Section 42. Observance of Board's orders, directions and instructions

[1] Section 42A. Reference to authorities

[2] Section 42B. Selection for audit by the Board

[4] Section 42C. Reward to Inland Revenue officers and officials

[1] Section 42D. Reward to whistleblowers

Section 43. Removal of difficulties and condonation of time limit etc

[6] Section 43A. Issuance of duplicate of 7[Federal Excise] documents

Section 44. Refund of duty

[2] Section 44A. Delayed refund

Section 45. Access to records and posting of excise staff, etc

[4] Section 45A. Monitoring or tracking by electronic or other means

[2] Section 45AA. Licensing of brand name

[1] Section 47. Service of notices and other documents

[2] Section 47A. Agreements for the exchange of information 3[or assistance in recovery of duties .]

[3] Section 47AB. Real-time access to information and databases

[1] Section 47B. Disclosure of info rmation by a public s ervant

[2] Section 47C. Validation

Section 48. Repeal

[1] Section 49. Fee and service charges

[5] Section 50. Uniform

FIRST SCHEDULE

SECOND SCHEDULE

THIRD SCHEDULE

This law in the library

Code of Criminal Procedure (CrPC), 1898 (Under Review)

State-owned Enterprises (Governance and Operations) Act, 2023