MAL PAKISTAN LTD. vs FEDERATION OF PAKISTAN S — 2025 PTD 1324 KARACHI-HIGH-COURT-SINDH

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MAL PAKISTAN LTD. VS FEDERATION OF PAKISTAN S. 3---Sales Tax Special Procedure Rules, 2007, Rr. 58-S & 58-T---Notification SRO 896(I)/2013 dated 4-10-2013---Delegated legislation---Extra tax, levy of---Estoppel, principle of---Applicability---Petitioners / taxpayers assailed show cause notices issued to them for recovery of 2% extra tax levied on goods so notified in addition to tax already levied---Validity---Certain functions have been delegated by Sales Tax Act, 1990 itself which otherwise are more of procedural in nature as to the effective date and its paraphernalia regarding input adjustment and payment in lieu thereof---Levy of extra tax was not a case of excessive delegation or for that matter, delegation of any legislative functions---By way of SRO 896(I)/2013 dated 4-10-2013, an extra tax of 2% was being collected in terms of S. 3(5) of Sales Tax Act, 1990---Provision of R. 58-T (5) of Sales Tax Special Procedure Rule, 2007 also provided that the specified goods on which extra sales tax was paid in the manner so provided, would be exempted from payment of sales tax on subsequent supplies including those as made by a retailer---This was in fact never an extra tax in essence, rather a mode to facilitate trade merely by making collection of a tax which was to be paid subsequently on supplies or at retail stage---Petitioners / tax-payers were estopped by their conduct as they had been availing such facility---This was never a direct tax upon petitioners / taxpayers but was on the end consumer and was to be made part of cost of goods and value of supply for the purposes of paying sales tax under Sales Tax Act, 1990---Such levy was neither discriminatory being confiscatory in nature and did not imping upon any fundamental rights---Division Bench of High Court declined to interfere in the competence and validity of legislation in question i.e. S. 3(5) of Sales Tax Act, 1990 as well as Rr. 58-S and 58-T of Sales Tax Special Procedure Rule, 2007 introduced by way of an amending SRO 896(I)/2013 dated 4-10-2013---Division Bench of High Court declared the provision of Sales Tax Act, 1990 and SRO 896(I)/2013 dated 4-10-2013 to be validly and competently enacted / issued and were not ultra vires---Constitutional petition was dismissed in circumstances.

MAL PAKISTAN LTD. vs FEDERATION OF PAKISTAN S — 2025 PTD 1324 KARACHI-HIGH-COURT-SINDH

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