Law: Sales Tax Act, 1990

Section: 3,4,13,2(41),2(28),2(48),36(1),72,Sixth Schedule

(a) Sales Tax Act (VII of 1990)--- ----S. 36(1)---Recovery of tax not levied or short-levied or erroneously refunded---Limitation---Invocation of provisions of S.36(1) of the Sales Tax Act, 1990 did not authorize the officer to issue notice for a period beyond five years---Show cause notice was admittedly issued on 28-4-2012, demand adjudged for period prior to 28-4-2007 was hit by limitation in view of express provision of law---Default adjudged against the taxpayer for tax period prior to 28-4-2007 remained illegal and unjustified---Time limitation in fiscal statutes, wherever provided, is mandatory and cannot be ignored or by passed on any basis---Order of authorities below was vacated to this extent and demand adjudged was annulled by the Appellate Tribunal being hit by limitation. (b) Sales Tax Act (VII of 1990)--- ----Ss.4, 13, 2(41), 2(28) & Sixth Sched.---S.R.O. 548(I)/2006 dated 5-6-2006---S.R.O. 549(I)/2008 dated 11-6-2008---Zero rating---Exemption---Conflict of primary and subordinate legislation---Effect--Taxpayer engaged in manufacture/import and supply of infant food items---Supply of such items was treated as chargeable to tax at zero per cent---Effect of claim of such supply was that registered person was allowed refund of input tax relatable to these supplies / goods---Notifications were issued by the Federal Government under S.4 of the Sales Tax Act, 1990---Post issuance of refund a case was made out against registered person that supply of such goods remained exempt under S.No.25 of the Sixth Schedule to the Sales Tax Act, 1990; that such items could not be validly treated as chargeable to sales tax at zero percent under the notifications; that primary legislation prevailed over a subordinate legislation in cases where there occurs a conflict between the two; and since exemption had been prescribed in the Sixth Schedule which formed part of the primary legislation i.e. Sales Tax Act, 1990 and that since rate of zero percent was provided for in the notification, a piece of subordinate legislation, the exemption would prevail over zero-rating meaning thereby that the refund, accruing by virtue of zero-rated supplies under the notifications, was…

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