Law: Sales Tax Act, (III of 1951)

Section: 17(1),8,7,28,3(5),3(1)(e),12(1),4(a)(b), 2(12)

Sales-tax Act, 1951 -- Sections 3, 7, 8, 12 -- Licensed manufacturer -- Purchase/import of raw materials free of sales-tax for own use and consumption -- Raw materials transferred as such to Ex-Manager in satisfaction of outstanding loans advanced by him -- Value of the raw material, whether liable to sales-tax in the hands of the licensed manufacturer -- Held yes -- Exemption -- Partly manufactured goods -- Manufacturer of electric fans -- Electric fans exempt from sales-tax -- Partly manufactured goods consumed in the manufacture of electric fans -- Whether liable to sales-tax -- Held no -- Central Board of Revenue Notification No. S.R.O. 475(K)/65, dated 14-6-1965 -- Stock of raw materials originally purchased/imported by assessee for his own use and consumption without payment of any sales tax on strength of manufacturing licence under S. 8 -- Company, however, not utilizing such goods for its own use but instead transferring raw materials to its Ex-Manager Director in satisfaction of outstanding loans advanced by him too company -- Held: Concession under S. 4 once forfeited by assessee under S. 12(1), goods become liable to sales tax under charging S. 3 -- Notification No. S. R. O. 475(K)/65 dated 14-6-1965 exempting electric fans from sales tax -- Partly manufactured goods already consumed in manufacturing fans -- Could not brought back to tax. JUDGMENT The judgment of the court was delivered by MUHAMMAD AKRAM J.}--This is an application under Section 17(1) of the Sales-tax Act, 1951 b referring the following question of law sold to arise out of an order dated the 24th of June, 1971 passes by the income-tax Appellate Tribunal, Peshawar Bench, Peshawar in S. T. A. No 89 of 1970-71 in respect of the assessment year 1964-65:-- "Whether on the facts and circumstances of the case the Tribunal was justified in granting exemption from sales-tax on RS. 39,208, the value of raw material transferred to Lt Col. Mushtaq Hussain and the element of raw material included in Rs. 3,625, the value of closing stock of finished goods, lying with the company on 14th June, 1961?" 2. The respondent-assessee is a private limited company and was engaged in the manufacture and…

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