Law: Sales Tax Act, 1990

Section: 3, 32, 40-D

Law: Constitution of Pakistan, 1973

Section: 247

Sales Tax Act, 1990 (III of 1990)-- ----Ss. 3, 32, 40-D, Sixth Sch. Entry No. 151, Eighth Sch. Entry No. 74--Constitution of Pakistan, 1973, Art. 247--Constitutional petition--Sixth Schedule--Entry No. 151--FATA/PATA tax exemption--Consumption certificate--Encashment of pay order--Security instrument--FBR Circular No. 5 of 2021--Delegated legislation--Parent statute--Audit & adjudication--Conditional exemption--Alternate remedy--Administrative refusal--Jurisdiction--Tax liability--Recovery proceedings--Interpretation of fiscal statutes--Subordinate legislation--Natural justice--Procedural fairness--Audit mechanism--Assessment proceedings--Exemption scheme--VAT regime--Rule of interpretation regarding exemptions was that when a taxpayer sought an exemption, burden lay upon taxpayer to establish entitlement to such exemption--Furthermore, if two interpretations were possible, one favouring Revenue was to be adopted--First proviso to Entry No.151 clearly stipulated that purpose of providing a pay order was to secure payment of sales tax in event that person importing goods did not consume them within tribal area--The Act of 1990 was completely silent about mechanism of issuance of a consumption certificate--Similarly, Entry No.151 did not envisage that on failure of importer to provide a consumption certificate, instrument/post-dated-cheque would be presented for encashment--Settled principle was that rules were subservient to parent statute--Ordinances and rules being subordinate or delegated legislation were framed under authority of parent statute and were therefore subservient to primary legislation--They could not contradict override or add to clear provisions of parent statute--To accept such assertions would be to elevate administrative convenience above statutory purpose thereby undermining very scheme and object of Act of 1990--It was by now established that there were three stages in imposition of a tax: there was declaration of liability, that was part of statute which determined what persons in respect of what property were liable--Next, there was assessment--Liability did not depend on assessment--Ex hypothesi that had already been fixed--But…