Law: Sales Tax Act, (III of 1951)

Section: 28

Law: Sales Tax Act, (III of 1951)

Section: 28

Law: Income Tax Act, 1922

Section: 23(1),34

Sales Tax Act, 1951 -- Section 28 -- Re-assessment -- Sales Tax assessment originally made on cotton seed -- Assessing Officer did not appeal his mind to question of assessability of cotton seed oil at the time of making original assessment -- Re-assessment proceedings pertaining to turnover of cotton seed oil -- Whether proper and valid -- Held yes -- JUDGMENT The judgment of the court was delivered by HAMOODUR RAHMAN, J..-- The petitioners in these cases who are owners of Cotton Ginning Factories and were duly licensed under Section 8 of the Sales Tax Act, 1951, were assessed for the years 1960-61 and 1961-62, respectively, to sales tax on cotton seed amounting to Rs. 46,888 and Rs. 4,912, respectively. The petitioners in Civil Petition No. 96 of 1968 were also assessed to sales tax for the year 1961-62 at Rs. 86,936. Being aggrieved by these assessments, they along with other cotton ginners filed writ petitions in the High Court of West Pakistan. On the ground that sales was not leviable even on cotton seed obtained from the ginning of own cotton under a circular of the Central Board of Revenue, issued on the 29th of December, 1960. These petitions were dismissed. They came up to this court and this Court by its consolidated judgment in the case of Noorani Cotton Corporation v. Sales Tax Officer [P.L.D. 1965 S.C. 161] took the view that the assumption of the parties that cotton seed oil was exempt from taxation was wrong. Thereafter the Commissioner of Income Tax and Sales Tax, Lahore Zone, by a circular letter issued on the 21st January, 1961, instructed all officers working under him to take steps to assess such cotton ginners to sales tax on their production of cotton seed oil under Section 28 of the Sales Tax Act, as amended by the Finance Act of 1963 and 1966. In pursuance of these directives the petitioners were re-assessed to sales tax. They again challenged these assessments by petitions under Article 98 of the Constitution in the High Court of West Pakistan but one Division Bench in the case of Messrs Pakistan Oil Mills v. The Sales Tax Officer Writ petition No. 2003 of 1967 held that the re-assessment for the period ending the 30th June, 1961, was…

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