COLLECTOR OF CUSTOMS, CUSTOMS HOUSE, NABHA, ROAD, LAHORE And 2
This petition for leave to appeal was filed by the Collector of Customs against the High Court judgment allowing the respondent's writ petition. The core dispute involved whether the respondent was liable to pay sales tax on imported goods where letters of credit were opened prior to the withdrawal of an exemption notification under SRO No. 504(1)/1994 dated 9-6-1994. The petitioners demanded sales tax upon arrival of the goods following the withdrawal of the exemption on 4-4-1996, relying on Section 6 of the Sales Tax Act and Section 31-A of the Customs Act 1969. The High Court had held that demanding sales tax for consignments where letters of credit were opened prior to the withdrawal of the exemption notification was without lawful authority. The Supreme Court granted leave to appeal to consider the legal question in line with a precedent involving similar issues.
- Whether sales tax can be demanded on consignments where letters of credit were opened prior to the withdrawal of an exemption notification?
- Whether Section 31-A of the Customs Act 1969 applies to sales tax exemptions upon withdrawal of an exemption notification?
- Section 6, Sales Tax Act
- Section 31-A, Customs Act 1969
ORDER
SALEEM AKHTAR, J.- The petitioners seek leave to appeal against the judgment passed by the learned Judge in Chambers allowed the writ petition filed by the respondent holding that demand for payment of sales tax from the respondent in respect of consignments where letters of credit have been opened before the withdrawal of the Notification of exemption is without lawful authority.
2. The respondent had opened 14 letters of credit on various dates ranging between 16-2-1995 to 20-2-1996 for import of copper tubes, aluminium plane indoor/outdoor units and components, It claimed benefit of exemption from sales tax under the SRO No. 504(1) of 1994 dated 9-6-1994. This exemption was with drawn on 4-4-1996. On arrival of goods the respondent claimed exemption from sales tax, but in view of section 6 of the Sales Tax Act, the petitioners insisted that the respondent was liable to pay the sales tax as section 31-A of the Customs Act was applicable to it.
3. Leave was granted to consider similar question in M/s. M.Y. Electronics Industries (Pvt.) Ltd.
Through Manager v. Government of Pakistan (Ministry of Finance), Islamabad and 5 others (1994 SCM R 2123). Accordingly leave is also granted in this case. The appeal should be heard along with the appeals arising out of the afore stated reported petitions.