Law: Sales Tax Act, 1990

Section: 4

(a) Sales Tax Act (VII of 1990)-----Preamble---Laws which impose tax on sales---Interpretation---Such laws, being tax laws, are subject to a strict construction in accordance with the tax statutes generally---In other words, a sales tax statute must be strictly construed in considering its coverage and no strained construction may be indulged in against the taxpayer simply because of the apparent purpose to raise needed revenue, nor will such statutes be given a retroactive operation, unless such an effect is clearly intended by the lawmakers. Crawford's Statutory Construction, Interpretation of Laws, Chapter XXVIII, page 738-739, para-359 ref. (b) Sales Tax Act (VII of 1990)-----Ss. 4, Second Proviso & 8(1)(b)---Notification S.R.O. 491(I)/2016 dated 30.06.2016---Notification S.R.O. 1125(I)/2011 dated 31.12.2011, condition (x), first proviso ("the impugned proviso") [as substituted vide Notification S.R.O. 491(I)/2016 dated 30.06.2016]---Notification S.R.O. 777(I)/2018 dated 21.06.2018---Input tax adjustment---Disallowance of input tax on packing material---Withdrawal of a proviso in an SRO---Effect---Whether retrospective effect could be given to such withdrawal---In the present case the restriction imposed for reclaiming input tax on packing material by way of Notification S.R.O. 491(I)/2016 dated 30.06.2016 ('the impugned S.R.O.') was not illegal, unlawful or without jurisdiction but it was within the realm and domain of powers vested in the Federal Government under section 8 of the Sales Tax Act, 1990---Petitioners (tax payers) had only challenged the constitutionality of the 'impugned proviso', which debarred them from lodging the claim on packing material---Challenge to the legitimacy of the impugned proviso was based on a misconceived notion; the impugned proviso was intra vires and could not be construed as ultra vires to any provision of Sales Tax Act, 1990 or the Constitution---Challenge to the vires of the impugned proviso substituted vide the impugned S.R.O had subsided when vide S.R.O. 777(I)/2018 dated 21.06.2018, the impugned proviso was omitted---Although the impugned proviso was withdrawn on 21.06.2018, but in clause (2) of the S.R.O.…

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