Law: Sales Tax Act, (III of 1951)

Section: 17,8,17(2)

Sales Tax Act (III of 1951)---Ss. 8 & 17(2)--Rayon imported by assessee on the strength of the manufacturing licence under S.8 without payment of any sales tax for the assessment year 1962-63--Sales tax, held, could not validly be levied on raw material imported without payment o f sales tax on the strength of manufacturing licence under S .8 of the Sales Tax Act, used for the manufacture of finished goods exempt from the sales tax. P L D 1986 SC 731 fol. Commissioner of Sales Tax ,North Zone (West Pakistan), Lahore v. H. Muhammad Hussain & Co. 1974 P T D 20 = P L D 1974 Note 21 at p. .57 and Commissioner of Sales Tax, Rawalpindi Zone v. Shafiq Corporation Ltd., Gujrat 1974 P T D 15 = PLD 1974 Note 25 at p. 64 ref. JUDGMENT AJMAL MIAN, J.-- This is an application under section 17(2) of the Sales-tax Act, 1951 (hereinafter referred to as the Act) filed by the Commissioner of Sales-tax, Central Zone A Karachi seeking the opinion of this Court on the following question: "Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that no Sales-tax is leviable under the Sales-tax Act in respect of raw material which after having been imported without payment of sales-tax on the strength of manufacturing licence under section 8 of Sales Tax Act, was used for the manufacture of finished goods exempt from the sales-tax." 2. The brief facts leading to the filing of the above reference are that the income-tax Officer levied sales-tax on the reyon, which was imported on the strength of the manufacturing licence under section 8 of the Act without payment of any sales-tax for the assessment year 1962-63. The assessee went in appeal before the Appellate Assistant Commissioner who by his order, dated 26-10-1967 remanded the case to the Income-tax Officer. The assessee filed appeal before the learned Income-tax Tribunal which appeal was allowed by an order, dated 23-7-1974 and it was held on the basis of the Lahore High Court cases, namely, Commissioner of Sales-tax North Zone (West Pakistan) Lahore v. H. Muhammad Hussain & Co. 1974 P T D 20 = PLD 1974 Note 21 at p.57 and Commissioner of Sales-tax,…

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