ADEEM HOSIERY DYEING through Proprietor Muhammad Rasheed, Faisalabad vs ASSISTANT COLLECTOR, COLLECTORATE OF SALES TAX, FAISALABAD and another
This constitutional petition was filed by the petitioner, Adeem Hosiery Dyeing, challenging the impending recovery of sales tax, additional tax, and penalties totaling Rs. 11,64,514. The petitioner had previously obtained an interim stay order from the Appellate Tribunal regarding the recovery of these amounts. However, due to the statutory limitation imposed by Section 46(4) of the Sales Tax Act, the stay order ceased to be effective after six months. The core legal question was whether the High Court could exercise its constitutional jurisdiction to grant a stay on recovery when the Appellate Tribunal, despite having the appeal pending, was statutorily barred from extending the interim relief. The Lahore High Court held that the petitioner's contention was well-founded. Consequently, the Court allowed the petition and directed that the impugned amounts should not be recovered from the petitioner during the pendency of the appeal before the Appellate Tribunal. The principle established is that the High Court may intervene under its constitutional jurisdiction to grant interim relief when the statutory remedy before a tribunal has become exhausted or ineffective due to legislative time constraints.
- Can the High Court grant a stay of recovery of tax when the Appellate Tribunal is statutorily barred from extending an interim order?
- Does the expiration of an interim stay order under Section 46(4) of the Sales Tax Act 1990 preclude the High Court from granting relief under Article 199 of the Constitution of Pakistan 1973?
- Is the High Court empowered to stay tax recovery proceedings during the pendency of an appeal before the Appellate Tribunal?
- Section 46(4), Sales Tax Act 1990
- Article 199, Constitution of Pakistan 1973
ORDER
The petitioner feeling aggrieved of an order in original requiring it to make payment of a sum of Rs.11,64,514 as sales tax alongwith additional tax and penalty of Rs.15,000 has preferred an appeal before the Appellate Tribunal. The Appellate Tribunal vide order, dated 24-4-2001 granted interim, relief to the petitioner by ordering stay of the recovery of the aforesaid amount. However, after the lapse of six months from the date of the aforesaid order the said order is no longer effective because of the provisions contained in section 46(4) of the Sales Tax Act.
2. It is contended on behalf of the petitioner that even though the petitioner's appeal is still pending before the Appellate Tribunal and A despite the fact the said Tribunal considered it fit to stay the recovery of the aforesaid amounts, the Appellate Tribunal is not in a position to extend the interim order because of the express provisions of section 46(4) referred to above.
3. It is, in the above circumstances, contended by learned counsel that an order directing the stay of the above-referred amounts, can be passed by the High Court in exercise of Constitutional jurisdiction because of the circumstances narrated above which show that the remedy before the learned Appellate Tribunal is no longer available to the petitioner as far as interim relief is concerned.
4. The aforesaid contention appears to be well-founded. This petition is, therefore, allowed and it is directed that the amounts impugned by the petitioner, in its appeal before the learned Appellate Tribunal, shall not be recovered from the petitioner during the pendency of the aforesaid appeal.
This order, however, shall be subject to the provisions of Article 199 of the Constitution.
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