Law: Sales Tax Act, 1990

Section: 33(13),46,47

SALES TAX ACT, 1990 (VII OF 1990) Sections 46 & 47 The department has filed reference against the order of ATIR which has deleted penalty and default surcharge, the matter being sub-judice before honourable Lahore High Court, the appeal filed by the department has become infructuous.- It was observed that the respondent claimed adjustment against the invoices issued by dummy/fictitious suppliers. Therefore, after issuing show cause notice and considering the reply assessment order No. 10/2012 dated 01.08.2012 was passed. Being dissatisfied the taxpayer filed appeal before the CIR(A) who has upheld the charge of tax fraud as well as the recovery of principal amount of tax. However, imposition of penalty equal to 100% of the amount involved is found unjustified, therefore, the same is directed to be reduced to 25% of the involved tax amount. Hence, this appeal. The learned DR appearing on behalf of the department has assailed the impugned order in the light of grounds of appeal reproduced above. He contended that the CIR(A) has erred in directing to reduce the penalty to 25% especially when the charge of tax-fraud has been upheld. On the contrary the learned AR of the respondent supported the impugned order. He further submitted that the registered person has also challenged order of the learned CIR(A) No. 18/A-II/2013 dated 07.01.2013 in second appeal and the ATIR vide its order bearing STA No. 487/LB/2013 (now reported as PTCL 2015 CL 787) allowed the same, therefore, the appeal filed by the department has become in fructuous. The learned AR further pointed out that the department has also filed reference before the honorable Lahore High Court against order of the Tribunal, hence, the matter is sub-judice and no further dilation is required. We have considered the rival arguments and also gone through the available record. It has been observed, that the taxpayer/ respondent has also challenged the order of the CIR(A) on the issues of input tax adjustment as well as the imposition of penalty and the Tribunal vacated the order of the CIR(A) on both the grounds. The Tribunal has already deleted the penalty and default surcharge and the department has filed…

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