This appeal has been filed by the Registered Person against the order of CIR(Appeals), Faisalabad, dated 22-7-201.0, whereby the learned CIR(Appeals) rejected the appeal of the registered person filed by it against the order in original dated 2-3-2010. Through their orders the authorities below, for reasons recorded in their respective orders, rejected the claim of registered person in respect of input tax of Rs.101,237 relating to the packing material purchased on 31-12-2008.
2, At the very outset the learned AR of the registered person raised a legal objection and contended that both the Assistant Commissioner, Faisalabad and the CIR(Appeals) who passed the order in original and order in appeal on 2-3-2010 and 22-7-2010, respectively, were not competent to assume jurisdiction and exercise powers under the Sales Act, 1990 at the material time. Elaborating his argument, the learned AR submitted that a new service group namely "Inland Revenue Service" was created through Finance Amendment Ordinance on 28-10-2009 as a result of which jurisdiction exercisable under the Income Tax Ordinance, 2001, Sales Tax Act, 1990 and Federal Excise Act, 2005, was consolidated. To give effect to the creation of the new cadre a number of amendments were made in all the three statutes in order to harmonize the Newly Created Service Group with the relevant statutes. The learned AR, further explained that the appointment of Sales Tax Officers was governed by section 30 of the Sales Tax Act, 1990 which for the sake of reference is reproduced hereunder:-- "Appointment of Officers.---For the purposes of this Act, the Board may, by notification in the official Gazette, appoint in relation to any area, any case or class of cases specified in the notification, any person to be--
(a) a Collector. Of Sales Tax;
(b) a Collector of Sales Tax 2b[(Appeals)];
(c) an Additional Collector of Sales Tax;
(d) a Deputy Collector of Sales Tax;
(e) an Assistant Collector of Sales Tax;
(t) a Superintendent of Sales Tax; 2c[(ff) a Senior Auditor of Sales Tax;]
(g) an officer of sales tax with any other designation."
The learned AR further argued that from the plain reading of above quoted provision of law it was quite evident that the appointment of sales tax officers was to be notified in the official gazette. He asserted that the appointment of Inland Revenue officers, i.e. Assistant Commissioner Inland Revenue and CIR(Appeals) who exercised powers in respect of the 'registered person by passing the order in original and the order in appeal, respectively, was never notified in the official gazette and for this sole reason both the officers were not competent to assume jurisdiction and exercise powers in respect of the registered person. Reliance in this context was placed on a number of judgments of the Supreme Court of Pakistan, High Court and the Tribunal listed hereunder:--
(a) "Messrs Fecto Belarus Tractor Ltd. v. Government of Pakistan" reported as PLD 2005 SC 605 = 2005 PTD 2286.
(b) "Commissioner. Of Sales Tax (Central); Karachi v. Messrs Pakistan Services Limited, Karachi" reported as PLD 1983 Kar. 297.
(c) "Messrs Kamalia Sugar Mills Ltd. v. The CIR (RTO), Faisalabad" S.T.A No. 212-213/LB/2010 dated 19-1-2011 -Appellate Tribunal Inland Revenue, Lahore Bench].
(d) 'Messrs Haydri Honda, Bahawalpur v. CIR (Legal Division), RTO, Multan" [S.T.A. No. 231/LB/2011 dated 17-8-2011 -- .
Appellate Tribunal Inland Revenue, Lahore Bench]."
3. It was further stressed that this Tribunal in Kamalia Sugar Mills, Limited, Faisalabad, v. CIR, RTO, Faisalabad (S.TA. Nos.212 and 213/LB of 2010) and Haidri Honda Banwalpur V. CIR Legal Division, RTO, Multan (S.T.A. No.203/LB of 2011) held that non-publication of appointment of Inland Revenue Officers in the official gazette of Pakistan as required under section 30 of the Sales Tax Act, 1990 was fatal to the assumption of jurisdiction by the officers who could assume jurisdiction and exercise powers under the Sales Tax Act, 1990 only if their appointment had been notified in the official gazette of Pakistan. The learned DR on the 'other hand, supported the orders of the authorities below.
4. We have given due consideration to the rival arguments and also gone through the relevant record available on file. From the perusal of record and submissions made at the bar it transpires that "Inland Revenue Service" was created through Finance Amendment, Ordinance i.e.f. 28-10- 2009 and as a consequence thereof certain amendments were also made in Sales Tax Law to harmonize law with the newly created service group -- the word Collector wherever appearing in the Sales Tax Act, 1990 was replaced by the word Commissioner whereas "the words Sales Tax Department or the Sales Tax were substituted by the Words Inland Revenue". Prior to the creation "Inland Revenue Service" appointment of officers under the Sales Tax Act, 1990 was made through Notification S.R.O. 547(I)/2008 dated 11-6-2008 read with section 30 of the Sales Tax Act, 1990. After the creation of "Inland Revenue Service" appointment of officers in the newly created service group was to be made in accordance with the procedure laid down in section 30 of the Sales Tax Act, 1990 i.e. Appointment of the officers was to be notified in the official gazette of Pakistan. However, no such notification on the pattern of S.R.O. 547(1)/2008 dated 11-6-2008 was published in the Official Gazette of Pakistan meaning thereby that the officers who continued to exercise powers under the newly created set up did so without any legal mandate or support. Although the words "by notification in the Official Gazette of Pakistan" occurring in section 30 of the Sales Tax Act 1990 were omitted from section 30 of the Sales Tax Act, 1990 through Finance Act, 2010 (effective from 5th June, 2010), the amendment, being prospective in effect, could not cure the jurisdictional defect in the issuance of show cause notice as well as order in original which were issued much earlier on 5-1-2010 and 2-3-2010, respectively. The entire structure raised on the foundation of an unlawful show-cause notice, and order-in-original passed in consequence thereof are not sustainable in the eye of law because both the show-cause notice and order-in-original have been issued without lawful authority.
Accordingly, the orders passed by the authorities below are held to be nullity in the eye of law and are vacated.
5. The appeal filed by the registered person succeeds. .