Law: Sales Tax Act, (III of 1951)

Section: 2(11),2(16),3(a),3(aa),3(d),3(e),5(3),12 (1)

Sales Tax Act, 1951 -- Sections 2(11), 2(16), 3(a), 3(aa), 3(d) - 3(e), 5(3), 12(1) (as amended by the Sales-tax (Amendment) Ordinance, 1970) -- Constitution of Pakistan, 1962 -- Article 98 -- Manufacturer or producer -- Sale price -- Goods made wholly or partly of gold or silver where raw material is supplied by customer -- Departmental instructions that sales-tax should be charged on full value of such goods including the value of raw material is supplied by customer -- Whether legal and valid -- Held yes -- Administrative instructions -- Central Board of Revenue -- Power to issue instructions to subordinate authority charged with execution of the Act, conferred by the Act itself -- Issuance of circular instructions -- Whether ex-facie without jurisdiction and illegal -- Held no -- Central Board of Revenue Circular No. 8 of 1970 -- Income Tax Act, Sec. 5(8) -- Writ -- Adequate remedy available in the Act -- Writ petition, whether premature -- Held yes -- Writ -- Adequate remedy available in the Act -- Writ petition, whether premature -- Held yes -- THIS JUDGMENT DELIVERED BY: NASIM HASAN SHAH, JUSTICE:---.--- The petitioners are Goldsmiths and Jewellers, who are engaged in the business of selling, buying and manufacturing items of jewellery and ornaments. They are aggrieved by the letter of the Commissioner of Income-tax, Lahore Zone, West Pakistan, dated 12th September 1970 wherein he has given the interpretation of the Department on certain provisions of Sales-tax Act, 1951, as amended by the Sales-tax (Amendment) Ordinance, 1970 (XV of 1970). The relevant part of his letter is as follows:-- "Sales-tax on the goods made wholly or partly of gold or silver where raw material is supplied by the customer shall be charged on the full value of such goods including the value of raw material. The value of goods supplied by the customer should be valued, at the market price prevailing on the date on which finished goods are supplied to the customer. The making charges should be added to the value of raw material to arrive at the taxable value of the goods supplied to the customer." It appears that before the Sales-tax (Amendment) Ordinance, 1970 was promulgated, the…

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