Customs Appeal No. 2265/LB of 2001, decided on 11th November, 2004. VS Customs Appeal No. 2265/LB of 2001, decided on 11th November, 2004., 2006 PTD-INCOME-TAX-APPELLATE-TRIBUNAL-PAKISTAN 637 (2004)

Sales Tax act (VII of 1990)---

----Ss.33(1) & 26---General penalties---Penalty was imposed for non-filing of return on the ground that every applicant who had applied for registration was supposed to file sales tax return as required by S.26 of the Sales Tax Act, 1990---Appellant was not a registered person in the month for which the penalty was imposed---Validity---Section 26 of the Sales Tax Act, 1990 provided that every registered person had to file the return---If an enterprise was not a registered person, it was not binding on the firm to file the return in the prescribed form---Appellant could not be penalized as he was not a registered person in the month for which the penalty was imposed.

Jamil Hussain for Appellant.

Malik Shabbir, Dy. Superintendent for Respondent.

Date of hearing: 11th November, 2004.

JUDGMENT

MIAN MUHAMMAD JEHANGIR, MEMBER (JUDICIAL).---Due to non-filing of sales tax return for the month of January, 2001 a contravention case against Messrs Pifco Enterprises, 23-First Floor, Shadman Plaza, Shadman Market, Lahore for violation of section 26(1) of the Sales Tax Act, 1990 read with section 2(9) ibid was submitted before Deputy Collector Sales Tax and Central Excise (Adjudication), Customs House, Lahore, consequently the show-cause notice dated 21-4-2001 was issued but no reply could be filed by the Pifco Enterprises, even Pifco Enterprises failed to attend the proceedings before the Adjudicating Officer, therefore, on the basis of this observation that the registered person is bound to file the sales tax returned every month, the Pifco Enterprises was held guilty, as a result of which penalty of Rs.2,500 was imposed on Pifco Enterprises under section 33(1) ibid. Hence this appeal by Pifco Enterprises (present appellant).

2. I have heard the learned counsel for the appellant Mr. Jamil Hussain, Advocate and Malik Shabbir, Deputy Superintendent for the respondent. I have also gone through the relevant record including parawise comments furnished by Assistant Collector Assessment and Processing.

3. The learned counsel for the appellant mainly argued that since the appellant was not a registered person as required by section 26 of the Sales Tax Act, 1990, therefore, no penalty could be imposed. In support of this contention he furnished an affidavit sworn by one partner of Messrs Pifco Enterprises named Zia Hameed.

4. On the other hand the representative of the respondent Malik Shabbir, Deputy Superintendent while referring to the parawise comments submitted that every applicant who has applied for registration is supposed to file the sales tax return as required by section 26 of the Sales Tax Act, 1990 but at the same moment he conceded that the appellant was not a registered person in the month of January, 2001 and that the registration was sought in the month of August, 2001.

5. The question arises as to what is the legal position in such situation. Section 26 of the Sales Tax Act, 1990 makes it clear that every registered person has to file the return. If an enterprises is not a registered person, it means that it is not binding on the firm to file the return in the prescribed form. Therefore, since Pifco Enterprises was not a registered person in the month of January, 2001, this firm could not be penalized.

6. Consequently order passed by Deputy Collector (Adjudication) dated 29-6-2001 (dispatched on 27-7-2001) is set aside. The appeal is hereby accepted.

C.M.A./499/Tax(Trib.)Appeal accepted.