Law: Sales Tax Act, 1990

Section: 10

Sales Tax Act (VII of 1990)---S. 10---Refund of input tax---Registered person manufac4urer-cum­exporter---Rejection of refund on the ground of "scrutiny for verification for input tax"---Passing of Order-in-Original beyond the show-cause notice---First Appellate Authority set aside Order-in-Original by observing that objection regarding "scrutiny for verification for input tax" was not mentioned in the show-cause notice and was never confronted to the registered person; and treated the Order-Up Original to have been passed beyond the scope of show-cause notice--Department contended that although the objection regarding scrutiny for verification for input tax was not mentioned in the show-cause notice but the same was the discrepancy on the basis of which the refund claimed by the registered person did not merit acceptance---Validity---Admittedly, charge of "scrutiny for verification for input tax" was not levelled in the show-cause notice, on the basis of which the refund claimed by the registered person had been rejected---Since the objection of "scrutiny for verification for input tax" was not confronted, the rejection of refund had no legal sanctity---If an order had been passed on the ground other than the grounds confronted to the taxpayer by way of issuance of show-cause notice, same had no legal sanctity---First Appellate Authority had rightly found the Order-in-Original to be illegal and void and set aside the same---Appellate Tribunal did not interfere in the order-in-appeal and the same was upheld by the Appellate Tribunal. 1987 SCMR 1840 rel. JUDGMENT NAZIR AHMAD (JUDICIAL MEMBER).---The above titled appeal has been filed at the instance of the department against the Order-in-Appeal bearing No.411 of 2007 dated 25-9-2007 recorded by Collector of Customs, Sales Tax and Federal Excise, Faisalabad whereby the setting aside of the order-in-original bearing No.690 of 2007 dated 22-1-2007 has agitated. 2. Brief facts emanating from record are that the registered person/ respondent is a manufacture-cum-exporter engaged in making zero rated supplies of textile goods. A refund of Rs.114,388 was claimed for the period November, 2004 out of which following two…

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