Law: Sales Tax Act, (III of 1951)

Section: 17(1),12(1),27(2),27

Law: Sales Tax Act, (III of 1951)

Section: 17(1),12(1),27(2),27

Law: Pakistan Penal Code, 1860

Section: 406,409

Sales Tax Act, 1951 -- Section 27(2) -- Refund -- Sales Tax realised from customers deposited by assessee in Government Treasury -- Amount in excess of the sales tax due from the assessee -- Amount over-paid whether refundable to assessee -- Held yes -- Taxing department can only insist on realising from assessee demand raised by it and no more -- Amount deposited in treasury found on assessment to be in excess to extent of about Rs. 3,000 -- Amount overpaid by assessee cannot be retained by taxing authority on ground that excess payment represented collection from customers and as such not refundable -- JUDGMENT The judgment of the court was delivered by HAMOODUR RAHMAN, C.J..-- This is a petition by the Commissioner of the Sales Tax, Lahore Region, for leave to appeal from a judgment of a Division Bench of the High Court of West Pakistan in a reference under Section 17(1) of the Sales Tax Act, 1951. The respondent-company, it appears, had during the year 1957-58 deposited in the Government treasury a sum of Rs. 21,338-14-9 under Section 12(1) of the Sales Tax Act as sales tax collected by it from its customers but when the assessment was made it was found that the said respondent was liable to pay sales tax for the said year only to the extent of Rs. 17,717. The balance of Rs. 3,621-14-9 which was found to have been overpaid by the respondent-assessee was, however, not refunded to it on the ground that since it was excess payment representing collection from customers, it was not refundable. This decision of the Sales Tax Officer was reversed in appeal by the Appellate Assistant Commissioner who held that the amount was refundable under Section 27(2) of the said Act. The view of the Appellate Assistant Commissioner was also upheld by the Appellate Tribunal. The reference in the High Court was, after a careful examination of all the decisions cited before it, answered in the affirmative and it was held that the Tribunal had rightly decided that the excess amount was refundable to the assessee under Section 27(2) of the Sales Tax Act, even though the amount represented monies collected from customers by way of sales tax. It is contended on behalf of the…

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