Law: Sales Tax Act, 1990

Section: 7,47,16

(a) Sales Tax Act (VII of 1990)---Ss. 7 & 47---Non-adjustment of input tax paid by the assessees against output tax---Authorities issued notice for recovery of additional sales tax and refused to adjust input tax against output tax on the ground that the assessee had two separate cement factories and both the factories were separately registered---Validity---Authorities had completely omitted to notice that there was no second registered person in existence at the time when the input tax was paid or when the deduction out of the output tax was made---Effect--¬Where import had been made by the assessees which had paid the input tax, assessee was entitled to deduct tax paid from the output tax payable on the cement produced by it---Subsequent registration of second factory (Phase II) was not of any significance---Orders passed by Authorities by not giving benefit of S.7, Sales Tax Act, 1990 to the assessee suffered from non¬-consideration of material facts---Orders of the Authorities for the recovery of additional sales tax were set aside in circumstances. (b) Sales Tax Act (VII of 1990)--- ----S.16---Second registration---Requirement---Under the provisions of S.16, Sales Tax Act 1990 and registration is only for those persons who are carrying on business in two are more Collectorates. JUDGMENT MALIK MUHAMMAD QAYYUM, J.---This judgment shall dispose of Custom Appeal No.95 of 1999 and Custom Appeal No.96 of 1999, both of which are directed against the same judgment of the Customs, Excise and Sales Tax Appellate Tribunal, Lahore dated 26-10-1999. 2. Briefly stated, the facts are that while conducting the audit of the appellant, the staff of the Sales Tax Collectorate, Faisalabad pointed out that the appellant had wrongly adjusted input tax amounting to Rs.8,84,89,759 involved in the import of cement plant by M/s: Maple Leaf Cement Factory Ltd. Phase-II against the supply of cement manufactured by M/s. Maple Leaf Cement Factory Ltd. Phase-1. The Additional Collector of Sales Tax, Faisalabad while adjudicating the case directed the appellant to pay the aforesaid amount of Rs.8,84,89,759 as sales tax alongwith additional tax under section 34 of the Sales Tax Act,…

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