Law: Sales Tax Act, 1990

Section: 3,6,14,38

JUDGMENT MR. MUHAMMAD ASLAM, TECHNICAL MEMBER.-(l). This appeal has been filed By M/s. Ali Soap Factory, Faisalabad against the remand orders No. 347/98 of the learned Collector Appeals, Central Zone, Lahore, which were passed by him on 6th July 1998. 2. Brief facts of the case are that the staff of Sales Tax, Faisalabad, visited the appellants unit for checking of their record. Scrutiny of the appellants record revealed that the appellants were manufacturing and supplying taxable goods i.e. Laundry soap block without getting themselves registered with the Sales Tax Department and without payment of sales tax. The visiting staff detected 88 blocks of soap in frames and 306 block ready for supply weighing 18640 kgs total weight 23640 kgs worth Rs. 4,41,700 involving sales tax of Rs. 55,212. Scrutiny of the appellants record further revealed that the appellants were engaged in the supply of soap blocks on an average of 20 blocks per day since 1-7-1996. It was alleged that the appellants during the period 1-7-1996 to 31-12-1996 cleared 1,44,000 kgs valuing @ 5% amounting to Rs. 1,27,600 and during period 1-1-1997 to 30-6-1997 cleared 144000 kgs worth Rs. 25,52,000 involving sales tax @ 10% amounting to Rs. 2,55,200. The appellants were, therefore, alleged to have evaded sales tax amounting to Rs. 4,38,012. The appellants were charged with violation of section 3, 6, 14 of the Sales Tax Act, 1990. The additional Collector of Sales Tax, Faisalabad while adjudicating the case ordered payment of sales tax amounting to Rs. 4,38,012. Penalty of Rs. 50,000 was also imposed on the appellants. 3. While pleading their case before the first appellate authority the appellants mainly contended that the whole proceedings conducted in the matter were ultra vires of law as the staff of the Sales Tax Department which visited their factory had not been so authorized either by the Board or the Collector of Sales Tax, Faisalabad, as per the requirement of law contained in section 38 of the Sales Tax Act, 1990. It was also contended that the appellants had already been registered with the Department of Sales Tax vide Registration Certificate No. 04-05-1522-00737 with effect from…

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