Justice Nadeem Azhar Siddiqi: This appeal has been filed by the appellant/department challenging the Order-in-Appeal No.121/2016 dated 18th August, 2016 passed by the Commissioner (Appeals) in appeal No.125/2016 varying the Order- in-Original No.222 of 2015 passed by the Assistant commissioner (Mr. Muhammad Yousuf Bukhari), SRB.
01. In brief the facts of the case as stated in the Order-in-Original are that the respondent is registered with SRB under service category of advertisement Services" chargeable to Sindh Sales Tax @ 16% under section 8 of the Sindh Sales Tax on Services Act, 2011 (herein after referred to as the Act) w.e.f. 01.07.2011.
02. It has been alleged in the order-in-original that during scrutiny of tax profile of the respondent revealed that it had continuously filed Null returns from the Tax periods July, 2011 upto June, 2013. It was further alleged that the respondent declared services amounting to Rs.273,801,978/= and Rs.387,949,292/= in the Income Tax return for the same period i.e. July-2011 to June-2012 and July-2012 to June-2013 which resulted in non-declaration and non-payment of Sindh sales tax of Rs.43,808,316/= and Rs.62,071,886/=. It was also alleged that sales tax amounting to Rs.22,663,091/= were withheld and deposited by the SRB registered persons against the respondent during the tax periods July-2013 to June-2014.
Whereas, the respondent has declared output tax of Rs.3,473,457/= during the tax periods under reference.
3. A show-cause notice dated 20.11.2015 was issued to respondent to explain as to why Sindh Sales Tax of Rs.43,808,316/= and Rs.62,071,886/= for the tax periods from July-2011 to June-2012 and July-2012 to June-2013 respectively, may not be assessed and further to explain as to why the short-declared/un-declared Sindh sales tax of Rs.19,189,634/= (22,663,091/= - Rs.3,473,457/=) for the tax periods July-2013 to June-2014 may not be assessed and recovered along with default surcharge and penalties.
4. The respondent before the Assessing Officer submitted that it is engaged in providing Advertising Agency Services which are liable to Sindh Sales Tax w.e.f. 01.07.2013, therefore, the revenue generated from providing services during July-2011 upto June-2013 were not taxable, therefore, the respondent did not declare the same in their sales tax returns. It was further submitted by the respondent that the service recipients of advertisement services are liable for payment of tax as per Sindh Sales Tax Special Procedure (Withholding) Rules, 2011 and the tax was withheld by service recipients for the tax periods July-2013 to June-2014. The respondent under cover of its letter dated 06.04.2015 provided copies of monthly sales tax returns along with proof of payment of Rs. 27, 663, 284/=.
05. The Assessing Officer passed the order-in-original only in respect of payment of default surcharge. Para 14 of the Order-in-Original is read as under: "14. Since, the aforesaid Sindh Sales Tax has not been deposited within the specified due date, therefore, I order the registered person to deposit the default surcharge of Rs.3,739,578/= as required in terms of section 44 of the Act, 2011, with respect to late payment of Sindh sales tax of tax periods invoked in the show-cause notice i.e. July, 2013 upto June, 2014."
6. The respondent challenged the order-in-original by way of filing of appeal before the Commissioner (Appeals) who varied para 14 of order in original as under: "Accordingly the appellant may himself apply to the Board under section 45 of the Act, 2011 or the Respondent may take the Matter with the Board within two (2) months of the receipt of this order and the appellant may seek abeyance of recovery from the Board. And during that period of these two (2) months the recovery shall not be affected. Order accordingly."
7. The appellant challenged the order-in-appeal before this forum. The respondent also challenged the order-in-appeal by filing separate Appeal No. 73/2016, which was decided by a separate order.
8. Mr. Aamir Ali states that he is only pressing grounds "D" and "F" of the Appeal. He submits that delay of 334 days was cordoned by Commissioner (Appeals) without any justification. He then submits that the stay granted by the Commissioner (Appeals) beyond the pendency of appeal is illegal and against the provisions of law.
9. Mr. Saeed Bux states that the delay was properly condoned after considering the relevant facts and the powers vests in the Commissioner (Appeals) have been properly exercised. He then submits that the Commissioner (Appeals) has granted stay beyond the date of order-in-appeal for the reasons that he was convinced that the respondent has a good case and has directed the respondent to approach the learned Chairman, SRB for waiver of default our charge. He then submits that AC-SRB was not justified in levying default surcharge as it was mentioned in the order-in-original that there was no delibrate intention or willful default on the part of respondent.
We have heard the learned representative of the parties and perused the record made available before us.
10. The appellant only press ground "D" and "F" which read as under: "D) That the Respondent No.02, by condoning the aforesaid delay of 334 days without any justification or explanation, traveled beyond the powers conferred by the section 57 of the Act-2011 and same is ultra vires to the section 57 (4) and 57
(5) of the Act and same is liable to be set aside.
"F) That the learned Respondent No.02 erred to pass the stay order for two months in respect of recovery and again traveled beyond the powers conferred by the section 58 of the Act-2011 in as much as stay, if any, can only be granted during the pendency of the appeal rather after passing of appeal order.
11. As far as the first ground is concerned, we have perused the order-in-appeal. Sub-section (5) of section 57 of the Act empowered the Commissioner (Appeals) to admit the appeal after expiration of prescribed time if the Commissioner (Appeals) is satisfied that the appellant was prevented by sufficient cause from lodging the appeal within that period.The requirement of section is satisfaction of Commissioner (Appeals) on showing sufficient cause. The discretion is available with the Commissioner (Appeals) and can be exercised on showing sufficient cause. The cause shown by the respondent was considered sufficient by Commissioner (Appeals).The discretion available to the Commissioner (Appeals) has been properly exercised in and not in an arbitrary manner but on showing sufficient cause to his satisfaction. The learned Commissioner (Appeals) has exercised jurisdiction vested in him properly and for valid reasons and we do not found any reason to interfere with his order.
12. Moreover even if the appeal is admitted beyond limitation the appellant is not aggrieved and cannot challenge the order-in-appeal as no effective relief has been provided by Commissioner (Appeals) to the respondent who had also filed appeal before the Tribunal.
As far as the second ground is concerned, the Commissioner (Appeals) can stay the recovery for a period of sixty clays. In this case the Commissioner (Appeals) keeping in view the facts and circumstances of the case had order that after disposal of appeal for two months the recovery shall not be affected. The back ground of the order is that the Commissioner (Appeal directed the parties to move to the Board under section 45 of the Act within two months of the order.
The order appears to be an equitable order passed in the interest of justice to provide a fair chance/opportunity to the respondent to plead its case before the Board and to save the respondent from coercive recovery as earlier the appellant attached the bank account of the respondent and recovered an amount of Rs.2,152,128/.. Sub-section (4) of section 58 of the Act of 2011 did not prohibit passing of such order at the time of disposal of appeal. Any act not specifically provided and not specifically prohibited can be undertaken, if such act tends to advancement of justice and to prevent injustice.
14. In view of above we do not found any merits in this appeal, which is accordingly dismissed.
15. The appeal is disposed of. Copy of the order may be provided to the authorized representatives of the parties.
(Agha Kafeel Barik) (Justice Nadeem Azhar Siddiqi)
Member Technical CHAIRMAN Karachi Dated 21.03.2017 Copies supplied to:- 1) The Assistant Commissioner SRB, Karachi.
2) The Respondent through authorized representative Copy for information to:- 3) The Commissioner (Appeals), SRB, Karachi.
4) Of fice copy .
5) Guard file.