BONANZA GARMENT INDUSTRIES PRIVATE LIMITED, KARACHI vs ASSISTANT COMMISSIONER, QUETTA Ss

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BONANZA GARMENT INDUSTRIES PRIVATE LIMITED, KARACHI VS ASSISTANT COMMISSIONER, QUETTA Ss. 2(115), 2(139), 25 & 52(6)---Balochistan Sales Tax Special Procedure (Withholding) Rules, 2018, Rr. 1 & 1(3)---Company having its head office in Sindh---Services availed by such company in the territorial jurisdiction of Balochistan---"Place of business in Balochistan" and "resident"---Scope---Appellant (a manufacturer of wearing apparels having registered office at Karachi had received taxable services in the territorial jurisdiction of Balochistan and also withheld sales tax on services---Plea of the Balochistan Revenue Authority (BRA), while passing concurrent adverse orders against the Appellant, was that the Appellant failed to pay said withheld sales tax to the BRA, which was recoverable---Stance of the appellant was that sales tax on services was withheld by the head office, hence, the same was paid to the Sindh Revenue Board (SRB)---Whether the appellant was legally required to pay tax withheld on advertisement services availed in the territorial jurisdiction of Balochistan to the BRA; and whether tax withheld from the service providers/ advertisers was recoverable by the BRA from the appellant ?---Held, that it was an admitted fact that the appellant had received services from advertisers who displayed advertisements of the appellant on the billboards in Balochistan---It was also admitted that the appellant had made payments to such service providers/advertisers and also withheld sales tax on services form said service providers/advertisers---However, the appellant had paid such tax to the SRB on the grounds that the appellant was registered with the SRB and the appellant was not resident of Balochistan---Appellant was held to be required to pay tax withheld sales tax to the BRA in light of said admitted facts and definitions of "place of business in Balochistan" and "resident" as provided in Ss. 2(115) & 2(139) of Balochistan Sales Tax on Services Act, 2015 ('the Act, 2015'), as well as Rr. 1 & 1(3) of the Balochistan Sales Tax Special Procedure (Withholding) Rules, 2018---But, pertinently said definitions when read together provided that a company was resident of Balochistan if it had place of business in Balochistan including virtual presence through which it carried on an economic activity---The appellant being resident of Balochistan was required under S. 25 of the Act, 2015 to get registered with BRA to withhold tax on services availed in Balochistan and pay the same to BRA---However, the appellant had paid tax withheld to the SRB on the grounds that payments to service providers were made by the appellant's head office located at Karachi---Record revealed that the appellant had opted not to appear before the Assistant Commissioner during adjudication of order-in-original which resulted in passing of a non-speaking ex-parte order---The Assistant Commissioner on his part had also failed to discuss said relevant provisions of law---Further, the order-in-original was silent regarding service providers of the appellant and the filing of the returns ; because in both the scenarios implications would be different for the appellant---Appellate Tribunal, while vacating both the impugned orders, remanded, the matter back to the Assistant Commissioner Balochistan Revenue Authority to re-examine the case afresh and to come up with a speaking order after providing proper opportunity of being heard to the appellant---Appeal, filed by Service provider, was disposed of accordingly.

BONANZA GARMENT INDUSTRIES PRIVATE LIMITED, KARACHI vs ASSISTANT COMMISSIONER, QUETTA Ss — 2025 PTD 842 QUETTA-HIGH-COURT-BALOCHISTAN

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