Commissioner Inland Revenue Zone-I, Lahore vs M/s. Pak Elektron Ltd. etc
This matter arises from a petition filed by the Commissioner Inland Revenue against the judgment of the High Court upholding the Appellate Tribunal's view that electricity meters qualify as equipment eligible for zero-rating under SRO 530(1)/2005 dated 06.06.2005. The core legal question is whether electricity meters constitute equipment used in the operation of an industrial process and are thus eligible for zero-rating under the relevant statutory regulatory order, or whether they are merely consumer durables. The Supreme Court held that power supply is crucial for plant and machinery operation, and electricity meters function as metering equipment classifiable as equipment used in the industrial process, aligning with previous jurisprudence. Consequently, the Court dismissed the petition and refused leave to appeal, affirming the lower forums' interpretation.
- Are electricity meters eligible for zero-rating as equipment under SRO 530(1)/2005?
- Whether electricity meters can be classified as equipment used in the operation of an industrial process?
1. ORDER: MR. JUSTICE UMAR ATA BANDIAL.--(1). The learned High Court by Judgment dated 24.04.2017 upheld the view taken by the learned Tribunal dated 13.08.2010 to hold that the electricity meters are equipment eligible for zero rating under the terms of SRO 530(1)/2005 dated 06.06.2005. The arguments advanced by the learned counsel for the Commissioner Inland Revenue is that electricity meters are consumer durables and are not eligible for classification as equipment. The learned Appellate Tribunal has quoted that 'the International Electro Technical Commission Switzerland's publications such as International Standards IEC 62052-1 1, IEC 62053-1 1, and IEC 62053-23 which categorically described 'electricity meters' as electricity metering equipment'. To our minds metering equipment can be for different purposes. In relation to machinery , equipment that measures temperature, speed, pressure etc. are also in the nature of metering equipments. Undeniably power supply is a crucial factor for the operation of plant and machinery . Therefore, electricity meters are classifiable as equipment used in the operation of the industrial process at the tax payer's premises. Reference is made to the case of Sindh Institute of Urology Vs. Federation of Pakistan (2017 PTD 603) which goes against the interpretation urged by the petitioner .
2. The view taken in the said judgment has been upheld by this Court in its judgment dated 11.02.2020 passed in Civil Appeal No. 737 of 2016 titled Federation of Pakistan and others Vs. Sindh Institute of Urology & Transplant & others. In view of the foregoing, this petition is dismissed and leave to appeal is refused. 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.