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DALDA FOODS LTD. vs FEDERATION OF PAKISTAN S — 2024 PTD 156 KARACHI-HIGH-COURT-SINDH

Case information

Citation
2024 PTD 156 KARACHI-HIGH-COURT-SINDH
Court
Sindh High Court
Year
2024
Reporter
PTD
Parties
DALDA FOODS LTD. vs FEDERATION OF PAKISTAN S
Subject matter
Civil
Provisions referred to
S. 25---F; S. 46---A; S. 46; S. 25; Federal Excise Act (VII of 2005); Federal Excise Act; Sales Tax Act

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

Judgment text as reported

DALDA FOODS LTD. VS FEDERATION OF PAKISTAN S. 25---Federal Excise Act (VII of 2005), S. 46---Audit, selection for---Commissioner, powers of---Scope---Plaintiff/taxpayer/company challenged notice issued by the Commissioner Inland Revenue under S.46 of the Federal Excise Act, 2005 and S. 25 of the Sales Tax Act, 1990, whereby the plaintiff was selected for audit---Central issue raised in the suit was whether under said provisions of law, the Commissioner could select a taxpayer for the purpose of conducting audit without assigning any reason---Held, that issue-in-hand had been answered in negative by the judgments of Indus Motors Co. Ltd. v. Federation of Pakistan reported as 2020 PTD 297 as well as Wazir Ali Industries Ltd. v. Federation of Pakistan reported as 2023 PTD 576 by holding that the Commissioner must frame legitimate mindful queries to the knowledge of a taxpayer after going through the returns by which he must be either satisfied after calling the record or otherwise; in case such mindful queries remained unsatisfied, he then was obliged to give reasons under S.25(2) of the Sales Tax Act, 1990 for conducting audit---Plaintiff prayed that present suit might also be decreed in light of the said findings---High Court, while restraining the defendants/FBR from acting upon the impugned audit notice declared that the impugned notice issued by the Commissioner to the plaintiff under S.46 of the Federal Excise Act, 2005 and S.25 of the Sales Tax Act, 1990, selecting the plaintiff for audit was unlawful for failing to disclose reasons and the said notice and also any subsequent follow-up notices were of no legal effect.

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