Supreme Court Suspends BHC Order In A Tax Matter

The Supreme Court on Thursday suspended the judgment of Balochistan High Court (BHC) pertaining to Sales Tax Act, 1990 with reference to the application of Article 247(3) of the Constitution of Pakistan in areas of FATA/PATA.

ISLAMABAD, (UrduPoint / Pakistan Point News - 8th Sep, 2022 ) :The Supreme Court on Thursday suspended the judgment of Balochistan High Court (BHC) pertaining to Sales Tax Act, 1990 with reference to the application of Article 247(3) of the Constitution of Pakistan in areas of FATA/PATA.

A three members bench comprising Chief Justice Umar Ata Bandial, Justice Qazi Faez Isa and Justice Syed Mansoor Ali Shah after hearing the arguments of FBR Counsel Hafiz Ahsaan Ahmad Khokhar suspended the judgment of BHC.

As per facts, the taxpayer imported timber from Afghanistan in non tariff area of Balochistan District Zohab and claimed sales tax refunds in view of only application of Article 247(3) of the Constitution, that being exempt and non tariff area, thus the law of Sales tax had no application there, but simultaneously had failed to provide the relevant invoices and proof for such consumption in non tariff areas to taxing authorities as per FBR appeal filed in Supreme Court.

However, three forums including the Commissioner Appeal, Appellate Tribunal and High Court of Balochistan accepted the contention of taxpayer/ Sherani traders and ordered for issuance of refunds.

Advocate Hafiz Ahsaan Ahmad Khokhar submitted while opposing the three judgments of BHC said that though the tax exemption was available under Article 247 (3) of Constitution to PATA areas of Balochistan but while claiming tax exemptions/refunds under the sales tax Act 1990 the tax payer was legally obliged and had to fulfill the requirements of sections 22, 23 and 73 of Sales tax Act 1990.

Hafiz Khokhar argued that the Commissioner Appeal, the Appellate Tribunal and the High Court while deciding the case had relied on an earlier judgment of Supreme Court, issued in 2003, but that had been revisited later on by the Supreme Court in 2008.

The court after hearing arguments accepted the contentions and passed leave granting order on the appeal of FBR.