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SUI SOUTHERN GAS COMPANY LTD. vs LARGE TAXPAYERS UNIT (L — 2026 PTD 728 KARACHI-HIGH-COURT-SINDH

Case information

Citation
2026 PTD 728 KARACHI-HIGH-COURT-SINDH
Court
Sindh High Court
Year
2026
Reporter
PTD
Parties
SUI SOUTHERN GAS COMPANY LTD. vs LARGE TAXPAYERS UNIT (L
Subject matter
Criminal
Provisions referred to
S. 8; 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

SUI SOUTHERN GAS COMPANY LTD. VS LARGE TAXPAYERS UNIT (L.T.U.) Ss. 7(1), 8(1) & 10---Taxable supplies---Lost / damaged goods---Input tax, adjustment of---Scope---Whether the taxpayer (Gas supply Company/SSGC) was entitled for adjustment of entire input tax including that which had been paid on Unaccounted for Gas ("UG"), notwithstanding the threshold fixed by OGRA?---Held : If any sales tax is paid on a product, which for some reason is not fully utilized in the production or manufacture of the finished goods, the input tax so paid can still be claimed and be fully adjusted against the tax liability---In the present case, the taxpayer's claim for adjustment of such input tax was denied by the Department on the ground that the said input was never used in final production of the finished goods---Loss of input/ raw materials does not fall within the scope of "used or to be used for any purpose other than for taxable supplies made or to be made as stipulated in S. 8(1) of the Sales Tax Act, 1990---Therefore, the proposed question was answered in the affirmative i.e. in favor of the taxpayer (SSGC) and against the Department---Thus, the order of the Appellate Tribunal Inland Revenue stood set-aside /modified---Special Sales Tax Reference Application filed by the taxpayer (SSGC) was allowed.

Other judgments reported in 2026 PTD

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