Sales Tax Instructions

Sales Tax Instructions, 2009
―disposal beyond the normal business activity‖. It is unfortunate that the Sales Tax Wing has not
been unable to locate the real issue involved in the references as well as in the advice.
2. The scrap, old plant, machinery and vehicles are certainly ―goods‖ but Sales
Tax on supply of goods shall be charged from a registered person only if he is a frequent and
constant supplier of such scrap, machinery or vehicles etc., as his business activity. For example
―If a registered person is an importer or retailer of plant, machinery or vehicles for the
purpose of supply of such plant, machinery or vehicles in furtherance of business or ―in the course
of business‖ he shall be liable to pay sales tax not only on the ―supply‖ of such material but also
on the ―disposal‖ thereof, under any condition. However, if a registered person is a manufacturer
of wooden furniture as a normal course of business the disposal of some old machinery or old
vehicle by him can never be termed as ―taxable supply‖ and, therefore, the sales tax shall not be
chargeable on such disposal.‖
3. Thus the earlier advice is reiterated by saying that sales tax shall not be
chargeable on the disposal of any scarp, machinery or vehicle by a registered person if;
(i)
(ii)
Such disposal of goods is beyond the normal and continuous supply as a
business activity of such person,
There was no value addition to such goods; and
(iii)
The input tax adjustment facility was not available for such goods.
4. Hence, there was no ambiguity, error or misinterpretation of law in the earlier
advice dated 3 rd June, 2000, which is reiterated.
(Muhammad Raza Khan)
Joint Secretary
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C. NO.1/243-STT/99 DATED 11 TH AUGUST, 2000
SUBJECT:-
REPORT OF THE COMMITTEE ON IMPOSITION OF GST ON
COAL AND PROBLEMS OF COAL MINING INDUSTRY IN
BALUCHISTAN
I am directed to refer to your letter No.10-Misc/St/CM/QTA/99/10024, 9 th
August, 2000 on the subject cited above and to say that the subject matter was taken up
with the Ministry of Finance and the Finance Minister has been pleased to approve the
following:
(a) Industries Department, Government of Baluchistan would maintain the bank
account to receive federal and provincial shares of subsidy.
(b) The mine owners will pay GST @ Rs.25 (out of a total of Rs.90 @ 15%) per ton
directly on the prescribed sales tax return in the designated branches of National
Bank of Pakistan in the normal way after being registered with the sales tax
department.
(c) The Collectorate of Customs, Sales Tax & Central Excise, Quetta would raise
demand for the remaining amount of sales tax upto the 10 th of each month.