Law: Sales Tax Act, 1990

Section: 10

Sales Tax Act (VII of 1990)---S.10---S.R.O. 27(I)/98, dated 17-1-1998--S.R.O. 455(I)/2004, dated 12-6-2004---S.R.O. 501(I)/06, dated 31-5-2006---C.B.R. Order C.No.2(1) ST/L&P/2000(Pt), dated 28-8-2006---Excess amount to be refunded---Suppression of production and sales of wastage---Refund claim was disallowed on the ground that amount in question pertained to tax on suppressed production and sale of wastage---No break-up/detail had been given in the refund payment order or order-in-appeal---Appellant contended that shortage in production was due to shrinkage duly supported by physical verification report produced by a team of officers of sales tax department, which confirmed shrinkage of fabrics up to 26%-Department had neither controverted the findings of this report in the written comments nor produced any evidence to prove the charges about suppression of production or supply of wastage/scrap---Major part of the amount had already been adjudged of the same order and refunded and there was no justification to withhold a small part of the claim on such ground---Appeal was accepted and the department was directed to refund the balance amount of appellant's claim. JUDGMENT ZAFAR-UL-MAJEED, MEMBER (TECHNICAL).----The facts giving rise to this appeal sales tax refund claim amounting to Rs.17 million in LTU Lahore on the basis of Central Board of Revenue's orders issued vide C No.2(1)ST/L&P/2000(Pt) dated 28-8-2006.This amount was deposited by the appellant against show-cause notice dated 4-9-1999 issued by the Department followed by Order-in-Original No.ST-13/2002 dated 19-2-2002 whereby Collector (Adjudication), Lahore adjudged the same amount as sales tax payable on account of (i) suppression of value of supplies, (ii) suppression of production and (iii) supply of wastage. The Adjudicating Officer adjudged the amount of sales tax on suppression of value on the basis of value determined by the Valuation Committee after including 40% addition in the value of cost of local taxable supplies as- plant, machinery and equipment was imported by the appellant under S.R.O. 27(I)/98 dated 17-1-1998 without payment of customs duty and sales tax. Subsequently,…

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