Law: Sindh Sales Tax on Services Act, 2011

Section: 30,43,Second Schedule

(a) Sindh Sales Tax on Services Act (XII of 2011)- - Ss.30 & 43- Failure to furnish return within the due date- Absence of mala fide- Scope- Appellant was imposed upon a penalty under Serial No. 2 of Table under S.43 for violation of S. 30 of Sindh Sales Tax on Services Act, 2011- Validity- Held, nowhere in the order-in- original the wilfulness, mala fide and mens rea of the appellant was established- Word "default" necessarily imported an element of negligence or fault and meant something more than mere non- compliance of statutory provision- Department, to establish default, had to prove that the non-compliance of statutory provision was due to some avoidable cause- Mere non-deposit of tax without element of wilfulness, mala fide or contumaciousness did not entail penalty- Appellant had tried to explain the reasons for non-payment of tax and non-filing of returns but it was prime duty of the department to prove mens rea and only then the burden could have shifted upon the appellant to explain the reason for non-filing of returns- Penalty imposed by assessing officer was set aside- Appeal was allowed. Pakistan through Secretary Ministry of Finance and others v. Hardcastle Waud (Pakistan) Limited PLD 1967 SC 1; Commissioner of Income Tax v. Habib Bank Limited 2007 PTD 901; Deputy Collector, Central Excise and Sales Tax, Lahore v. ICI Pakistan Limited, Lahore PTD 2006 1132 and Slingshot v. AC Appeal No.AT-92/16 rel. (b) Sindh Sales Tax on Services Act (XII of 2011)- - S.43- Offences and penalties- Mens rea- Scope- Penalty can only be imposed if non-payment of tax on the part of taxpayer is proved as mala fide, wilful, contumacious and having an element of mens rea. JUDGMENT: JUSTICE (RETD.) NADEEM AZHAR SIDDIQI, CHAIRMAN:---.--- This appeal has been filed by the appellant challenging the Order-in-Appeal No.78/2018 dated 21.05.2018 passed by the Commissioner (Appeals) in Appeal No. 10/2017 filed by the appellant against the Order-in-Original No. 12/2017 dated 21.01.2017 passed by the Assistant Commissioner, Unit 27 (Ms. Shumaila Yar Muhammad), SRB, Karachi. 1. The facts of the case as mentioned in the Order-in-Original are that the Appellant is registered…

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