Law: Sales Tax Act, 1990

Section: 2(37),3,6,8A,8(1)(ca),21(3),22,23,26,47( 5)

Law: Sales Tax Rules, 2006

Section: 12(5)

Sales Tax Act (VII of 1990)--- ----Ss. 8(1)(ca) & 21(3)---Refund or adjustment of input tax (tax credit)---Zero rated supplies made to blacklisted units---Burden of proof---Respondent taxpayer claimed refund of a certain amount---Taxpayer was served with a show cause notice alleging therein that taxpayer claimed refund against invoices of units that were suspended/blacklisted units---Appellate Tribunal set-aside the order-in-original by holding that at the time of transactions, the subject units were admittedly not blacklisted and there was no final order even to date against the allegedly blacklisted units; held, that the Appellate Tribunal had given a finding of fact that suppliers in question were operative during the period when the business/transaction took place---Even otherwise, initial burden laid on the department to show either that invoices had been issued during suspended or blacklisted period or in case invoices were not issued during period of blacklisting, then the cause or reason for blacklisting had some nexus with the invoices---Taxation Officer in the present case did not establish that said invoices were either fake or flying or the claimed tax was not deposited in the Government Exchequer---Judgment of Appellate Tribunal was upheld---Reference application was disposed of accordingly. THIS ORDER PASSED BY: MUHAMMAD SAJID MEHMOOD SETHI, JUSTICE:---.--- Through instant Reference Application under Section 47 of the Sales Tax Act, 1990 ("the Act of 1990"), following questions of law, asserted to have arisen out of impugned order dated 09.12.2014, passed by learned Appellate Tribunal Inland Revenue, Lahore Bench, Lahore ("Appellate Tribunal"), have been argued and pressed for our opinion:- i. "Whether on the facts and in the circumstances of the case, the decision of learned appellate tribunal to allow the zero rated supplies made to blacklisted units is consistent with the provision of sections 3, 6, 8A, 22, 23 and 26 of the Sales Tax Act, 1990? ii Whether on the facts and in the circumstances of the case, the learned Appellate Tribunal was justified to hold that order of blacklisting cannot operate retrospectively? 2. Brief facts are that…

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