Sales Tax Act (VII of 1990)‑‑‑

‑‑‑‑S. 13‑-‑S.R.O. 500(I)/(88)‑‑‑Constitution of Pakistan (1973), Art.185(3)‑‑‑Leave to appeal was granted by the Supreme Court to examine questions as to whether respondent Mills were entitled to exemption of Sales. Tax on import of consignment, despite withdrawal of exemption, in view of the fact that consignment landed at port after supersession of S.R.O. 500(I)/88 and whether Mills could maintain Constitutional petition before High Court without exhausting departmental remedies before Sales Tax hierarchy under provisions of Sales Tax Act, 1990.

Fecto Belarus Tractors Ltd. v. Federation of Pakistan 2001 SC 109 ref.

Akhlaq Ahmad Siddiqui, Advocate‑on‑Record for Petitioners.

S. Zaki Muhammad, Dy. A.‑G. of Pakistan on Court notice.

Afsar Ali Abidi, Advocate Supreme Court and K.A. Wahab, Advocate‑on‑Record for Respondent No. 1.

Nemo for Respondents Nos.2 and 3.

Date of hearing: 10th February, 2004.

ORDER

RANA BHAGWANDAS, J.‑--Leave to appeal is sought against the Sindh High Court, judgment, dated 13‑2‑2002 allowing Constitutional petition filed by the respondent No.1 impugning the vires of notice of demand of sales tax on the import of steel drums for respondent Textile Mills.

2. Case of the writ petitioner was that though S.R.O. 500(I)/88, dated 26‑6‑1988 allowing exemption from payment of sales tax had been superseded by S.R.O. 554(I)/94, dated 9‑6‑1994 withdrawing exemption, from whole of the sales tax, letter of credit was opened on 29‑3‑1994; the fact remains that the consignment landed at‑ the port of Karachi on 26‑6‑1994 i.e. after the withdrawal of the exemption from payment of sales tax. It appears that the High Court was impressed by the judgment of this Court in Fecto Belarus Tractors Ltd, v. Federation of Pakistan (Sindh Balochistan Law Reports 2001 SC 109). This judgment was the subject matter of review petition before this Court and has been set aside vide precedent reported as Pakistan v. Fecto Belarus Tractors Ltd. (PLD 2000 SC 208). It is stated at the Bar that the judgment in the review case is again sub judice before this Court in another proceeding and Legislature has taken steps to undo the effect of this judgment.

3. In the peculiar facts and circumstances of the case, we are inclined to grant leave to examine, inter alia, the following questions:‑‑

(i) Whether the respondent‑Mills were entitled to the exemption of sales tax on the import of consignment, despite the withdrawal of the exemption, in view of the fact that the consignment landed at the port of Karachi after the supersession of S.R.O. 500(I)/88?

(ii) Whether the respondent‑Mills could maintain Constitutional petition before the High Court without exhausting departmental remedies before the sales tax hierarchy under the provisions of Sales Tax Act, 1990?

H.B.T./C‑19/S Leave granted.