Law: Sales Tax Act, (III of 1951)

Section: 7(1),17(1)

Law: Sales Tax Act, (III of 1951)

Section: 7(1),17(1)

Sales-tax Act, 1951 -- Section 7(1) -- Exemption -- "Hot-patches"-- Words "Cycle accessories" used in item No. 9 of Notification No. 9, dated 27-6-1951 -- Whether include "hot-patches" -- Held yes -- Hot-patches, whether exempt from sales-tax -- Held yes -- Words "Component" and "Accessories", meaning of -- Statutes -- Provisions granting exemptions -- Whether onus is on the claimant to prove that his case falls strictly within the scope of the exemption -- Held yes -- JUDGMENT The judgment of the court was delivered by MUHAMMAD AFZAL CHEEMA J.-- These three Civil Reference (No. 60of 1967, 12 of 1970 and No. 90 of 1971), made by the Income-tax Appellate Tribunal (Pakistan) Lahore, under Section 17(1) of the Sales-tax Act, 1951 (No. III of 1951) are connected matters involving the determination of the identical question of law, which has been formulated as under:-- "Whether on the facts and circumstances of the case, the Tribunal was right in holding that "hot-patches" are exempt from levy of sales-tax under item No. 9of Notification No. 9, dated 27-6-1951, issued by the Government of Pakistan, Ministry of Finance (Revenue Division) under Section 7(1) of the Sales-tax Act?" 2. The facts giving rise to the reference are that M/s. Lutfi and Company (Pakistan) Limited, Lahore, manufactured "hot-patches", which are handy pieces of rubber used for mending punctures having been processed with certain chemicals containing sticking material which on being created becomes readily applicable to the punctures. The assessee's assertion that that they were exclusively manufactured for mending cycle tubes, does not appear to have been controverted at any stage. They claimed exemption of their declared turn-over in this regard from payment of sales-tax under item No. 9 of Notification No. 9. dated 27-6-1951 according to which inter alia "Cycle accessories" were not chargeable to sales-tax. This contention before the Sales-tax Officer that "hat patches" were a kind of "cycles accessories" was repealed by him on the ground that hot-patches "were not additional, subsidiary, adventitious contributing to or aiding the manufacture of cycles", that they did not constitute an item of…

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