Sales Tax Instructions

Sales Tax Instructions, 2009
2. The Board has however taken a very magnanimous view as per SRO 461(I)/99 and
allowed the principal amount to be paid by 30.04.1999 even if these cases are in adjudications.
3. On the rationale of the above decision, there is no justification for the continuation of the
penal action against persons falling in category (vi) of the above notification, since, the principal
amount of sales tax has already been deposited last year against payment of 5% penalty envisaged
by the relevant Rules.
4. It is therefore requested that necessary clarification may kindly be issued to the
concerned departments that cases of persons falling in category (vi) of the above S. R. O. may be
closed, if the principal amount of sales tax due and the penalty there against has already been
paid by the concerned textile mills.
5. We have faith and confidence in your wisdom and sagacity and hope for your urgent
orders in the interest of justice.
Lord bless you always,
Javaid Umar
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C.No.1/25-STT/99 DATED 28 TH APRIL, 1999
SUBJECT:-
SALES TAX ON ARL‘S NAPHTHA PRODUCTION.
I am directed to refer to your letter No.PL-3(447)/95, dated 8 th February, 1999 on
the subject cited above and to say that except for the goods specified in the Sixth
Schedule to the Sales Tax Act, 1990, all goods are sales taxable under the law. Partly
manufactured goods (intermediary), if used within the same factory, to manufacture
goods in respect of which sales tax is leviable on their supply are exempt vide entry at
S.No.43 of the Sixth Schedule to the Sales Tax Act, 1990.
2. Since the intermediary product (Naphta classification under PCT heading
2707.4000) does not fall in the category of goods exempted from the levy under the Sixth
Schedule, the same is chargeable to sales tax. Its use in the further manufacture of a sales
tax exempt product does not make the naphtha itself exempt from the sales tax leviable
thereon.
3. Without pre-judice to the merits of the case, reported to be under
adjudication, it is pertinent to say that even the notifications issued by the Ministry of
Petroleum & Natural Resources vide its No.PL-3(169)/99 dated 26 th January, 1999 and
No.PL-3(169-A)/99 dated 26 th January, 1999 notify the rates of development surcharge
on Naphtha vide Note (3) and Note (1) respectively, of the said notifications relating to
PRL/NRL and ARL, respectively.
4. The cases of levy of sales tax on Naphtha (used as intermediary product
in the further manufacture of exempt POL product in the same refinery) are reported to
be under adjudication in the respective Collectorates of Sales Tax. The refineries may be
advised to plead their case with the respective Adjudicating Officer who shall decide the
cases on merits.
[Issued by the CBR, Islamabad under the signature of Mr. Muhammad Tahir, Secretary
(STT) addressed to the Director General (Oil), Department of Petroleum & Energy Resources,
Ministry of Petroleum & Natural Resources, Islamabad. Copy to the Collector, Sales Tax (East)
Karachi/Collector, Sales Tax, Islamabad and Secretary (ST.Edu.), CBR.]
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