Law: Sales Tax Act, 1990

Section: 11,3,7,8

Sales Tax Act (VII of 1990)--Ss. 11, 3, 7 8--Assessment of tax and recovery of tax not levied or short levied or erroneously refunded--Determination of tax liability- -- Tax credit not allowed--Scope--Taxpayer adjusted and claimed a certain amount as input tax on obsolete stock--Department while refusing to accept the claim of taxpayer ordered for recovery-- Commissioner (Appeals) allowed the appeal filed by taxpayer-- Validity--In the scheme of Sales Tax Act, 1990, Ss. 7 8 are not charging sections--Both the sections pertain to the domain of payability--Section 7 enunciates the principle for determining the tax liability for particular tax period of a registered person in respect of taxable supplies and it is provided that such registered person shall be entitled to deduct input tax paid during the tax period for the purpose of taxable supplies made or to be made by him from the output tax that is due from him in respect of a particular tax period--Amount paid by the taxpayer belonged to him and the assessee was entitled to seek at its discretion either adjustment or refund-- Impugned order did not require interference--Appeal of the department was dismissed. Messrs Mafair Spinning Mills Ltd., Lahore v. Customs, Excise and Sales Tax Appellate Tribunal, Lahore and 2 others 2002 PTCL 115 foll. ORDER: MRS. AMBREEN ASLAM, JUDICIAL MEMBER.---Through this order we intend to dispose off the titled appeal filed by the department against the Order bearing . No. STA/152/LTU/2015 dated 12-06-2015, passed by the learned Commissioner Inland Revenue (Appeals-I), Karachi on the following grounds: 1. That the order of the learned Commissioner Inland Revenue (Appeals-I) is had in law and on merits of the case. 2. That the learned Commissioner-IR (Appeals-I) was not justified under the law to hold that the stock valuing Rs.46,941,000/- shown in the Annual Accounts under the sub-heading of “obsolete stock” on which input tax of Rs. 7,979,970/- claimed and adjusted is admissible under the law while the said stock is unfit and not salable. 3. That the learned Commissioner IR (Appeal-1) was not justified under, the law to hold that the input tax of Rs. 17,192,596/- claimed and…

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