Sales Tax Instructions

Sales Tax Instructions, 2009
HONOURABLE SUPREME COURT JUDGMENT DATED 2 ND
JUNE, 2000.
I am directed to refer to you letter C. No.1654-IR-II/DGRRA/PDP-7751-ST
dated 4.12.2000 and to say that the judgment of Honourable Supreme Court dated
2.6.2000 categorically set aside subsection 1-A of section 3 of Sales Tax Act, 1990 in its
entirety and not partially. The said conclusion is based on the point that the supply of
sugar falls within the ambit of section 3(1) of Sales Tax Act, 1990 and not under clause
(c) of sub-section 2 to section 3 ibid. Besides, the Supreme Court at para 2 of its
judgment had clearly mentioned that the tax levied through first amendment (made in
1998) was struck down by Peshawar High Court on acceptance of W. P. No.1713/98
dated 6.10.1999. In the same judgment dated 2.6.2000, the Honourable Supreme Court of
Pakistan at para 5 of the judgment, while converting petitions into appeals has
categorically accepted the appeals to the extent of 1% further tax imposed in 1998.
2. In view of the position detailed above, it is once again requested that the
subject PDP may please be settled under intimation to CBR and Multan Collectorate.
[Issued by the C.B.R., Islamabad, under the signature of Mr.Muhammad Nazim Saleem,
Secretary (ST-AUDIT),addressed to Mr.Ali Hussain Shah, Dy. Director, office of the Director
General, Audit revenue Receipts, PTA& Audit Building, Mauj-e-Darya Road, Lahore.]
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C.No.3(19)STP/2000 DATED 27 TH FEBRUARY, 2001
SUBJECT:-
WITHHOLDING TAX ON COMMERCIAL & INDUSTRIAL GAS
CONSUMERS UNDER SECTION 50(7G).
I am directed to refer to your letter No.ST/Reg/Value Gas/6/2000 dated 22 nd July,
2000 on the subject cited above and to say that the question whether withholding tax
charged from consumers in the natural gas bills is to be included in the value of supply
for the purpose of levy of sales tax on such gas was considered in the Board (Sales Tax
Wing) in consultation with the Income Tax Wing and the Law & Justice Division. The
Law & Justice Division and Income Tax Wing agree that since withholding tax is merely
a mode of partial advance recovery of income tax from an assessee and not the value of
supply of gas, therefore, the component of withholding tax is not liable to sales tax as
provided in section 2(46) of the Sales Tax Act, 1990.