Indus Motor Company Limited has disclosed a potential additional customs duty liability of approximately Rs 73.3 billion arising from a dispute over concessionary imports under SRO 656. The issue stems from amendments introduced through SRO 2069(I)/2022, under which automobile manufacturers seeking concessionary customs duty treatment were required to meet specified year-wise export targets.
Indus Motor has challenged these conditions before the Sindh High Court, arguing that the amended export requirements are inconsistent with the original purpose of SRO 656, which was intended to support local vehicle assembly and manufacturing. The Sindh High Court granted interim relief in January 2024, allowing the company to continue imports at concessionary rates. According to the company’s annual report, the potential customs exposure has accumulated to Rs 13.7 billion for FY2023, Rs 12 billion for FY2024, Rs 19.7 billion for FY2025 and Rs 27.9 billion for FY2026, aggregating to Rs 73.3 billion.
The case highlights an important customs principle: a concessionary rate is often linked with continuing compliance conditions. Where those conditions are subsequently disputed, amended or considered unfulfilled, the resulting exposure can extend well beyond the duty payable on current imports and may accumulate across several years. For businesses operating under SRO-based concessions, therefore, continuous monitoring of eligibility conditions and post-import obligations is as important as obtaining the concession itself.