Law: Punjab Sales Tax on Services Act, 2012

Section: 14,49,52,66,67

Law: Income Tax Ordinance, 2001

Section: 156A,PartIII,FirstSchedule

ORDER: On 28.02.2017 Additional Commissioner Enf-III of PRA, Lahore issued show cause notice to M/s Pakistan State Oil Company Ltd. (The Appellant). In the show cause notice the appellant was treated as a withholding agent in terms of Rule 2 of PSTS (Withholding) Rules 2015. The notice further stated that during the period from July 2015 to June 2016, the appellant recei ved taxable services from various commission agents and that under sections 14 and 19 of the PSTSA, 2012 (The Act) read with Rules 4, 5, 6, and 13 of Rules ibid, the appellant was legally bound to withhold/deduct and deposit the due amount of sales tax on services but failed to comply with the statutory obligations. Detail of the services were as under. Sr. No. Service Category Income Tax Withheld @ 12% Total Commission Paid PST Payable 1. Commission agents (Sr.No.42 to 2nd Schedule) 1,693,676,805/- 14,113,973,375/- 2,258,235,740/- The show-cause notice charged the appellant with the violation of different provisions of The Act, as mentioned supra and called upon to show cause under section 52 read with 60 that why the above stated amount may not be assessed/recovered, along with the default surcharged under section 49 of The Act. 2. In response to the show cause notice, M/s A.F. Ferguson Co., the authorized representatives (AR) appeared, submitted reply, discussed/argued the case and produced relevant documents before the authority. After considering the evidence and the arguments, the authority passed the order dated 18.09.2017 whereby the contents of the show cause notice were upheld. Feeling aggrieved, the appellant filed an appeal before the Commissioner (Appeals), PRA Lahore and on 05.09.2018 the order of the Additional Commissioner was upheld except the modification made to the extent of imposition of penalty which was deleted against the appellant. Being dissatisfied with this order of the Commissioner (Appeals), the present appeal under section 66 of The Act, before this tribunal was filed on the following grounds. 1. That the appellate order dated September 5, 2018 (serviced on October 10, 2018) passed by the learned Commissioner (Appeals) Punjab Revenue Authority [˜PRA] in the matter…

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