' Through instant reference application, the applicant has proposed following three questions, which according to learned counsel for the applicant, are questions of law, arising from the impugned order dated 01.09.2016 passed by the Appellate Tribunal Inland Revenue (Pakistan)
Karachi in S.T.A. No, 158/KB-2014 for the Tax Years 2008-2009 and 2009-2010.
"A. Whether under the facts and circumstances of the case, learned ATIR was justified in holding that exemption from sales tax is available on the sales of assets other than those falling in Table- 11 of the Sixth Schedule of the Sales Tax Act, 1990?
B. Whether under the facts and circumstances of the case, learned ATIR was justified in partly deleting the recovery of output tax on the pretext that it is barred by time?
C. Whether under the facts and circumstances of the case, learned ATIR was justified in admitting the evidence, which was not produced before the Assessing Officer?"
2. Learned counsel for the applicant has readout the impugned order passed by the Appellate Tribunal Inland Revenue, as well as the orders passed by the authorities below and submits that the Commissioner (Appeals) and the Appellate Tribunal Inland Revenue, were not justified to set- aside the order passed by the Deputy Commissioner-IR in the instant case, whereby, the recovery of sales tax on the sale of the fixed assets by the respondent in terms of Section 11 of the Sales Tax Act, 1990 has been made by the Deputy Commissioner-IR.
3. We have heard the learned counsel for the applicant, perused the record as well as the orders passed by the authorities below with his assistance and have also examined the relevant provisions of Sales Tax Act, 1990 applicable in the instant case. It will be advantageous to reproduce the relevant findings of the Commissioner (Appeals) as well as the Appellate Tribunal, whereby, the subject issue has been dealt with in detail in the following terms:-- "Disposal of Assets: The officer has charged the sales tax on disposal of assets. The officer has himself mentioned in the impugned order that assets were not exempt under the sales tax law except those assets against which input tax adjustment was not availed. The A.R. Of the appellant categorically stated that no input tax adjustment had ever been claimed by the appellant against those assets, hence, the charge was without any base. He further emphasized that the charge pertained to specific year of 2008-2009 as mentioned in the impugned order, hence, the same is not maintainable in the light of provisions of section 11(5) of Sales Tax Act, 1990. The contention of the. A.R., is worth consideration and it is observed that the charge is against the provision of law as no input tax was availed by the appellant on these assets disposed off during the tax period relevant to tax year 2008-2009. Even otherwise it is barred by time limitation in the light of section 11(5) of Sales Tax Act, 1990, hence, same is not maintainable and directed to be deleted." and ' We have heard the arguments of learned A.R. Of the taxpayer and grounds of the department and have also perused the available record of the case. The department has raised the question of exemption of fixed assets disposed off by the appellant during 2008-2009. On merits of the case, we specifically asked the learned departmental representative whether the appellant has availed it..Dut tax adjustment on disposal of such assets or otherwise. The departmental representative vide letter C.No,ATIR/FECTO SDUGAR/STA No,158/ZONE-11/LTU/2016 dated 04.08.2016 has informed that the registered person had claimed input tax on purchases of fixed assets from M/s Heavy Mechanical Complex (Pvt.) Ltd. And Messrs Siemens Pakistan Engineering Co. Ltd. And did not charge sales tax at the time of disposal of fixed assets. On the other hand, the learned A.R.
Has informed that the assets disposed off by the appellant, which are subject matter of this appeal, pertains to old truck trolleys used for carriage of sugarcane on which input tax adjustment was not available to the appellant under S.R.O. 490(1)/2004 dated 12.06.2004 issued in exercise of powers conferred by clause (b) of subsection (1) of section 8 of the Sales Tax Act, 1990 read with table-11 of the Sixth Schedule of the Sales Tax Act, 1990, hence no question of claiming of input tax adjustment on such assets arises. According to learned A.R., the officer, without revealing the description of goods, has pointed out only suppliers from sales tax returns and has assumed the same as fixed assets sold by the appellant which is absolutely baseless and contrary to the facts of this case. The learned A.R. Has placed on record the details of fixed assets sold by the appellant which are old vehicles. We have noted that the appellant has rightly sold the vehicles without payment of sales tax as no input tax was available and claimed on them being exempt supply in terms of SRO as quoted supra. The report filed by the officer is without any specific details of sale of vehicles and thus is irrelevant in this case of appellant. The judgment of Hon'ble Supreme Court of Pakistan relied upon by the department is not relevant in this case of appellant due to different facts, hence distinguishable. Even otherwise, as observed by the learned CIR(A), the assets were sold during 2008-09 which stands time barred in the light of section 11(5) of the Sales Tax Act, 1990. Thus, we are of the view that the treatment given by the learned CIR(A) is partially correct."
4. From perusal of hereinabove concurrent findings as recorded by the two Appellate Forums, it appears that the Deputy Commissioner Inland Revenue, without examining the nature of the assets or having ascertained as to whether any input adjustment was claimed by the respondent on such assets during the relevant period has charged sales tax on sale of fixed assets on the pretext that disposal of assets attracted the imposition of sales tax under Sections 11(2) and 11(3) of the Sales Tax Act, 1990. Whereas, it has come on record that respondent had disposed of old sugarcane truck trolleys on which no input adjustment was claimed by the respondent as it was not available in terms of S.R.O.490(I)/2004 dated 12.06.2004 issued in terms of section 8(1)(b) of the Sales Tax Act, 1990 read with Table-II of the Sixth Schedule of the Sales Tax Act, 1990. It also transpired that the recovery proceedings initiated by the respondent in terms of Section 11 of the Sales Tax Act. A 1990 in the instant case are also time-barred for the reason that such assets were sold during the period 2008-2009, whereas, in terms of subsection (5) of the Section 11 of the Sales Tax Act, 1990, period of limitation is five year from the relevant date, which in the instant case is to be calculated from 30.06.2008 and would expire by 30.06.2013.
5. In view of hereinabove facts and circumstances of this case and the legal position which has emerged, we are of the opinion that impugned order passed by the Appellate Tribunal in the instant case, does not suffer from any error or illegality, whereas, it depicts correct legal position.
Accordingly, instant reference application being misconceived and devoid of any merits is hereby dismissed in limine along with listed application, and the questions proposed hereinabove are answered in Affirmative against the applicant and in favour of the respondent.