Collector Of Customs, Sales Tax (West), Karachi vs M_S. K&A Industries, Karachi
This matter arises from a petition filed by the Collector of Customs, Sales Tax (West), Karachi, challenging an order of the High Court of Sindh, Karachi, which had allowed the respondent's appeal and struck down a demand for Additional Tax on the ground that the show-cause notice was barred by limitation. The core legal question before the Supreme Court was whether the show-cause notice dated 12th August 1999 issued in respect of the tax year 1994-95 was within the three-year limitation period prescribed under the relevant statute. The Supreme Court held that the show-cause notice was indeed served beyond the prescribed period of limitation under sub-section (2) of section 36 of the Sales Tax Act, as the petitioner's counsel failed to satisfy the court otherwise. Consequently, the court affirmed the High Court's findings, dismissed the petition, and declined leave to appeal. The key principle laid down is that a show-cause notice issued beyond the statutory limitation period under the Sales Tax Act is void and legally unsustainable.
- Whether a show-cause notice issued beyond the limitation period prescribed under the Sales Tax Act is sustainable?
- Does a show-cause notice dated 12th August 1999 for the tax year 1994-95 fall within the three-year limitation period?
- Section 36(2), Sales Tax Act
ORDER
CHIEF JUSTICE IFTIKHAR MUHAMMAD CHAUDHRY.-(1). This petition calls in question the following order passed by the High Court of Sindh, Karachi:- "By the impugned order the appeal filed by the respondent was allowed and the demand of Additional Tax was struck down for the reason that the show-cause notice, dated 12-8-1999 was beyond the prescribed limitation in terms of sub-section (2) of section 36 of the Sales Tax Act. Mr. Abdul Sattar Silat was not able to dislodge the finding which is based on facts. Consequently, the appeal has no merits and the same is dismissed, with no order as to costs."
2. Learned counsel when confronted with the provisions of sub-section (2) of section 36 of the Sales Tax Act, and was called upon to explain as to whether in respect of the year of 1994-95, show cause notice, dated 12th August, 1999, was within the prescribed limitation i.e. Three years. He could not answer satisfactorily. Thus it is held that show-cause notice was served beyond the period of limitation as prescribed in sub-section (2) of section 36 of the Sales Tax Act and as such learned High Court had rightly non-suited the petitioner.
Petition is dismissed and leave declined. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.