' The appellant has filed appeal before this Tribunal against Order-in-Appeal No,110 of 2012 dated 21-3-2012 by the Commissioner Inland Revenue (Appeals), Faisalabad on the following grounds:--
(1) That the both orders of the learned Commissioner Inland Revenue (Appeals), RTO Faisalabad as well as Assistant Commissioner, Inland Revenue enforcement unit-2 Zone-I, RTO, Sargodha are bad in law and contrary to the facts and circumstances of the case.
(2) That the learned Commissioner (Appeals) was not justified in confirming the order passed by the Assistant Commissioner which is illegal and unwarranted.
(3) That the order in appeal is ultra virus of the Constitution of Pakistan, Sales Tax Act, 1990 hence illegal, void ab initio, and of no legal consequences and is liable to be quashed.
(4) That the order passed by the learned Commissioner Appeals (IR) is not a speaking order, and he will not appreciate any of the citations provided at the time of hearing and merged in the grounds of appeal.
(5) That the Commissioner Appeals (IR) was not justified to disallow the input tax claim when all the requirement regarding payment proofs under section 73 of the Sales Tax Act, 1990 and section 23 of the Sales Tax Act, 1990 are fulfilled.
(6) That the said CIR(A) has not appreciated, the arguments of the appellant that the appellant is an authorized 3(5) dealer of motorcycle company namely Dawood Yamaha Limited and all the payments were made through banking channels all the evidences regarding purchase invoices payment proof the copy of company ledger account and verification letter issued by the parent company regarding the purchase was provided during the course of hearing, ignoring the fact that main figure of difference of the input tax pertains to Tax period of December-09 which is of 418,879 and the company verified only this amount in its letter dated 19-10-2011 . The reconciliation chart of the amount of input tax claimed is explained in the given chart below, Sr. No. Date of invoiceInvoice No. Value Sales Tax
1. 3-12-2009 SICA-M010-11-05-05963 7,20,340 1,15,254
2. 10-12-2009 ISPL-ED10-02-16-13-115942,170 347
3. 10-12-2009 ISPLSP10-02-16-13-11593 3,872 619
4. 10-12-2009 ISPL-SP10-02-16-13-11372 320 51
5. 10-12-2009 ISPL-SP-10-02-16-13- 113701,140 182
6. 15-12-2009 SICA-MO10-01-11-05- 064053,43,245 54,920
7. 17-12-2009 SICA-M010-01-11-05- 064714,14,017 66,245
8. 20-12-2009 SICA-M01001-11-05- 0658911,31,971 1,81,115
9. 24-12-2009 ISPL-SP10-02-16-13-12685440 70
10. 24-12-2009 IPLSP1002464342398 480 76 TOTAL 26,17,995 4,18,879 ' It is now settled proposition, that the registered person may not be deprived from his legal money due against the Government where there is particularly no mis-statement, forgery, collusion, cheating, fraudulent activity are alleged or any false claim is submitted by the registered person with the view to obtain the illegal gain or causing loss to the government, reported as 2010 PTD (Trib.) 2656.
(7) That the learned Commissioner Appeals (IR) and Assistant Commissioner (IR) were not justified to reject the claim of input tax as it is the substantive right of a taxpayer and it cannot be with held on mere technical grounds, as the supplier put the name of the registered person in the category of unregistered person mistakenly, reliance in this regard is placed on the citation reported as 2011 PTD (Trib.) 1943.
(8) That the learned commissioner Appeals (IR) was not justified in maintaining a charge under section 8A of the Sales Tax Act, 1990 on account of joint and several liability of registered person in supply chain where tax was unpaid, in the instant case the registered person is under the mechanism of Value Added Tax made payment of input Tax to the supplier through banking channel and the same was duly deposited in the Government treasury. Reliance is made in this regard is placed on the citation reported as 2012 PTD (Trib.) 350.
(9) That even otherwise the recovery of the said amount from the appellant is tantamount to double taxation which is ultra vires to the Act.
(10) That the appellant in good faith and bona fide fulfilled all the requisite conditions in terms of section 7 of the Act for claiming input tax and paid the tax to the supplier, fulfilling the condition of section 73 of the Act.
(11) That the learned Commissioner Appeals (IR) totally ignored the fact that there is no charge framed against the appellant regarding section 23 of the Act and subsequent impugned assessm ent order is passed merely on assumptions and presumptions which is not warranted under law as principal laid down by Honorable Sindh High Court Karachi in a judgment reported as 2004 PTD 868 "that Sales Tax imposed on the base of some assumption and presumption not warranted in law shall always be struck down.
(12) That the learned Commissioner Appeals (IR) was not justified to discuss the option that was available to the supplier of the appellant to revise the return they have not availed in this case, because the appellant has no power under the law to convince or force the supplier that he revises his return wrongly submitted.
(13) That the learned ACIR and CIR(A) were erred in law while interpreting the provision and object of sections 36(1) and 11(2) of the Sales Tax Act 1990 when the due tax was deposited in the Government treasury and there is no loss of revenue.
(14) That your appellant be leaved, to add, to amend or alter the above said grounds.
2. Brief facts of the case are that during the reconciliation of input tax claimed against the purchases made by Messrs Motor Cycle Zone, Larry Adda Road, Sargodha with supplier's supplies of output tax of Messrs DYL Motor Cycle Limited from the period mentioned in table below, it had been observed that Messrs Motor Cycle Zone, bearing Sales Tax Registration No,0805870000428 have been claimed/adjusted input tax which is not reflected in the suppliers supplies. It means that Messrs Motor Cycle Zone, Larry Adda Road, Sargodha have claimed/adjusted inadmissible input tax. Detail is as under:- S. No. Month/Tax Period Input Tax Claimed by youOutput tax Declared by SupplierDifference/Reco- verable Amount (Rs.)
1 Jul-09 266969 266939 30 2 September-09 332511 329329 3182 3 October-09 259035 258219 816 4 December-09 418879 0 418879 5 March-10 405334 402990 2344 6 April-10 293292 292002 1290 7 May-10 168299 168064 235 TOTAL 426776
3. This appeal came up for hearing on 11-4-2013. We have heard the rival argument to the case. The only issue in this case is that there is a mis-match between the appellant's input tax claim and the supplier's sale summary relevant to the appellant's input claim. The appellant contends that this difference is due to the reason that the appellant's supplier misreported him as a non registered person. The facts of this case suggest that the appellant's supplier made a mistake by wrongly reporting him as a non registered person, however, this mistake does not justify infliction of financial loss on the appellant. The respondent knows it too well that the appellant is a distributor of motorcycles and cannot transact his business without sales tax registration. The respondent also possesses the authority to direct the appellant's supplier to fix the Mistake. Besides, the respondent has all the power to figure out whether the appellant claiming input tax, duly discharged his onus of payment of output sales tax at the time of making any taxable transaction.
Therefore, this case is remanded to the Assessing Office for allowing the appellant an opportunity to explain the difference between the amount of appellant's input tax claim and the mistake in the supplier's sale summary and assisting him in correction of the sale summary. In case, the corresponding output tax has been paid by the appellant, his claim of input tax may be accepted.