CYANAMID PAKISTAN LTD. VS COLLECTOR OF CUSTOMS SALES TAX AND CENTRAL EXCISE, 2006 PTD-KARACHI-HIGH-COURT-SINDH 1902 (2006)

(a) Sales Tax Act (VII of 1990)---

----Ss.7, 8, 59, 71 & 73---Constitution of Pakistan (1973), Art.199---Constitutional petition---Beneficial provision of law---Non-extending of benefits on the basis of subsequent insertion in same statute---Assessee sought adjustment of input tax from output tax for the period when it was registered voluntarily---Authorities refused such adjustment and also did not extend the benefit under S.59 of Sales Tax Act, 1990---Customs, Excise and Sales Tax Appellate Tribunal also denied privileges and benefits of S.7 of Sales Tax Act, 1990, on the ground that provisions of Ss.8, 59, 71 and 73 of Sales Tax Act, 1990, were subsequent to S.7 of the Act in sequence and the latter provisions of the Act overrode the earlier provision of law---Tribunal also denied the benefit for the reason that S.7 of Sales Tax Act, 1990, did not control the provisions of S.59 of Sales Tax Act, 1990, as the latter was a special provision envisaging a special situation and allowing certain benefits with the disciplines of limitations and conditions prescribed therein---Validity---High Court disagreed with the view taken by Customs, Excise and Sales Tax Appellate Tribunal that subsequent provisions under a statute overrode the earlier provisions---No such view was sustainable until and unless legislature had specifically provided that the subsequent provisions would have overriding effect---High Court set aside the view taken by the Tribunal regarding exclusion of S.7 by S.59 of Sales Tax Act, 1990 and remanded the matter to the Tribunal for decision afresh---Appeal was allowed accordingly.

(b) Interpretation of statutes---

----General and special provisions of a statute---Applicability---Principles---If two sections deal with similar circumstances, special provisions under the statute would exclude the general provision in the statute---If two provisions deal with different situations and operate in different sets of facts then, the special provision would not exclude the general provision for the reason that they are not exclusive of each other---If two provisions of law, one special in nature and the other general in nature deal with two different situations there would be no overriding effect.

(c) Interpretation of statutes---

----Fiscal statute---Concession/benefit, extension of---Principles---Duty of Court---Scope---If assessee claims some concession or benefit under two different provisions of law, it is the duty of Court to examine whether the benefit is available in both or in anyone of the provisions---Benefit has to be extended until and unless there are some conditions prescribed under the law which have not been fulfilled.

Aziz A. Shaikh for Appellant.

Javed Farooqui for Respondent.

Date of hearing 5th April, 2006.

JUDGMENT

MUHAMMAD MUJEEBULLAH SIDDIQUI, J.---Succinctly stated the relevant facts giving rise to this appeal are that the appellant engaged in supply of pharmaceutical goods got itself voluntarily registered under section 18 of the Sales Tax Act, 1990 on 6-8-1995. Subsequently, it was registered under section 14 of the Sales Tax Act, 1990 in October, 1997. The appellant claimed adjustment of input tax from output tax for the period April, May and June, 1996 under their monthly returns for the period from 1st July, 1996 to 21st October, 1996.

The departmental officers took exception to this adjustment of tax for the reason that the appellant was registered under section 14 in October, 1997 and therefore, for the period April, May and June, 1996 it was not entitled to the adjustment under section 7 and was merely entitled to the concession given by the legislature under section 59 of the Sales Tax Act, 1990 which was also inadmissible as the necessary conditions were not fulfilled.

The appellant preferred appeal before the learned Customs, Excise and Sales Tax Appellate Tribunal, Karachi Bench-II, assailing the findings of the departmental officers contending that the adjustment was rightly claimed under section 59 of the Sales Tax Act, 1990 with further plea that even if it is not admissible under section 59, which was adjusted under the bona fide impression, the adjustment is available to the appellant under section 7 of the Sales Tax Act, 1990. It was pleaded that under section 7 of the Sales Tax Act, 1990 the conditions are that the person claiming adjustment should be a registered person and be engaged in taxable supplies during the course of taxable activity. The Tribunal considered the contentions with reference to section 59 and gave findings that the adjustment was not admissible with reference to section 59 of the Sales Tax Act, 1990. However, no finding was given on the merits of the plea that adjustment was available under section 7 as well.

Mr. Aziz A. Shaikh, learned counsel for the appellant has contended that admittedly the appellant was registered under section 18 as it stood in the year 1995 and was granted registration by the department under section 14 without any application on the part of the appellant, with effect from October, 1997. He has maintained that the condition precedent for claiming the adjustment under section 7 is registration of a person and it is not necessary that the person should be registered under section 14 only. His contention is that whether a person was registered under section 14 or 18, it comes within the purview of expression `registered person' used in section 7 and was, therefore, entitled for adjustment. Learned counsel for the appellant has submitted that since the learned Tribunal has not considered this contention on merits, therefore, the case be remanded to the learned Tribunal to give a finding on the plea raised before the Tribunal after affording a fresh opportunity of hearing to the parties.

Mr. Jawaid Farooqui, learned counsel for the respondent has not denied that the impugned order of the Tribunal contains that the plea was raised that the adjustment was available under section 7 of the Sales Tax Act, 1990 which is inalienable right vested in taxpayer but the Tribunal has not given any findings on this point on merits.

A perusal of the impugned order of the Tribunal shows that an observation has been made, as follows:--

"The privileges and benefits of section 7 of the Sales Tax Act, 1990 can be and have been prescribed to be specifically negated or disallowed by the aforesaid provisions of the said Act also because the said provisions of sections 8, 59, 71 and 73 are subsequent to section 7 in sequence and the later provisions of an Act override the earlier provisions of law. The provisions of section 7 do not control the provisions of section 59 as the later is a special provision envisaging a special situation and allowing certain benefits within the disciplines of limitations and conditions prescribed therein."

We are not persuaded to agree with the view taken by the learned Tribunal that subsequent provisions under a statute override the earlier provisions. No such view is sustainable until and unless legislature has specifically provided that subsequent provisions shall have overriding effect. So far the view that section 59 is a special provision, therefore, it would exclude the provisions contained in section 7 is concerned, it is also untenable for the reason that this principle shall be applicable if two sections deal with similar circumstances and in that case special provision under the statute shall exclude the general provision in the said statute. However, if the two provisions deal with different situations and operate in different set of facts there the special provision shall not exclude the general provision for the reason that they are not exclusive of each other. If two provisions of law, one special in nature and the other general in nature deal with two different situations there would be no overriding effect. We find that the section 59 deals with entirely different situations as compared to section 7 and consequently the view taken by the Tribunal is not sustainable in law which is hereby set aside.

If an Assessee claims some concession or benefit under two different provisions of law, it is the duty of the Court to examine whether it is available in both or in anyone of them and if concession/benefit is available in any one of them, it has to be extended until and unless there are some conditions prescribed under the law which have not been fulfilled.

Consequent to the above findings and setting aside the view taken by the Tribunal regarding exclusion of section 7 by section 59 of the Sales Tax Act, 1990, we are persuaded to agree with the submission of learned counsel for the appellant that the case be remanded to the Tribunal for fresh findings on the point whether the appellant is entitled to claim adjustment under section 7 of the Sales Tax Act, 1990.

The impugned judgment of the Tribunal is, therefore, set aside and the case is remanded to the learned Customs, Excise and Sales Tax Appellate Tribunal, Karachi Bench-Il, with directions to give fresh opportunity of hearing to both the parties and give fresh findings on the point narrated in this judgment. In addition to the point narrated in this judgment, the appellant shall be entitled to raise any other plea of law and facts available to it.

The learned Tribunal is directed to, pass fresh orders within four months of receiving the copy of this judgment.

The appeal stands disposed of in the above terms along with E listed-applications.

M.H./C-14/K?????????????????????????????????????????????????????????????????????????????????????? Case remanded.