' Through instant reference application, the applicant department has proposed the following two questions, which according to learned counsel for the applicant, are questions of law arising from the impugned order dated 11.01.2016 passed by the Appellate Tribunal, Sindh Revenue Board in Appeal No,AT-52/2014:-- "A. Whether the Honorable Appellate Tribunal, SRB was justified to delete the penalty under Serial No,03 of the Table under Section 43 of the Act in respect of non-payment of SST notwithstanding the fact that the respondent has provided taxable services during the tax period under consideration which is contravention of sections 8, 9 and 17 of the Act?
' B. Whether the Honorable Appellate Tribunal, SRB was justified to delete the penalty under Serial No,03 of the Table under Section 43 of the Act in respect of non-payment of SST while on the other hand the penalties in respect of non-filing of returns and compulsory registration are confirmed?
2. However, after having read out the proposed questions and the impugned order passed by the Appellate Tribunal, Sindh Revenue Board, learned counsel for the applicant has requested that he may be allowed to reformulate the question of law in such a manner that it may refer to a legal dispute having been decided by the Appellate Tribunal. Such request of the learned counsel has been acceded to in the interest of justice, pursuant to which the learned counsel for the applicant has, reformulated the question in the following manner:- "Whether the Appellate Tribunal Sindh Revenue Board (SRB), was justified to delete the penalty at Serial No,3 of the table under Section 43 of the Sindh Sales Tax on Services Act, 2011 for non- payment of sales tax due?"
3. Learned counsel for the applicant has read out the impugned order passed by the Appellate Tribunal as well as the orders of the authorities below, and submits that the respondent in the instant case did not file the sales-tax return in violation of Sections 8, 9 and 17 of the Sindh Sales Tax on Services Act, 2011, therefore, finding of the Appellate Tribunal to the effect that, since there was no determination of assessm ent of tax liability in terms of Section 23 of the Sindh Sales Tax on Services Act, 2011, therefore, the penalty of Rs,210,000/- imposed by the applicant department is not justified in law, is incorrect. It has been prayed that impugned order passed by the Appellate Tribunal, Sindh Revenue Board, may be set-aside and the question proposed hereinabove may be answered in negative in favour of the applicant.
4. We have heard the learned counsel for the applicant, perused the record and the impugned order passed by the Appellate Tribunal, Sindh Revenue Board as well as the orders of authorities below with his assistance. It will be advantageous to reproduce hereunder the relevant finding of the Appellate Tribunal on the subject controversy as contained in the following paras. 8 and 9 of the impugned order:- "8. The second question is that the Assessing Officer while ordering compulsory registration has imposed penalty of Rs,10,000/- on account of non-registration, Rs,105,000/- for not filing tax returns for the periods July 2011 to March 2013 and Rs,210,000/- on account of non-deposit of Sindh Sales.
Tax. The penalty can be imposed under the Act if any person who is required to apply for registration under the Act fails to make an application for registration before providing or rendering taxable services, such person is liable to pay penalty of Rs,10,000/- or five percent of the amount of Sales Tax whichever is higher. It was further provided that in case of non-compliance of compulsory registration the minimum penalty should be Rs,100,000/-. Since the appellant failed to get registration from SRB and also failed to file e-returns for the periods July 2011 to March 2013 the penalty of Rs,10,000/- and Rs,105,000/- was rightly imposed. The Assessing Office has also imposed Rs,210,000/- under Table 3 of section 43 on account of non-deposit of tax due. The Assessing Officer has not passed any assessm ent order under section 23 of the Act. The penalty under Table 3 section of 43 can only be imposed if it is established that the taxable services against consideration has been provided or rendered but due tax has not been deposited. This fact is lacking in the present case.
9. In view of the above I am satisfied that both order-in-original and order-in-appeal to the extent of compulsory registration of appellant and imposing penalty of Rs,10,000/- and Rs,105,000/- is proper and legal and call for no interference. The penalty of Rs,210,000/- is set aside and is subject to the determination of tax due for periods July 2011 to March, 2013, consequently the appeal is partly allowed and both the order-in-original and Order-in-Appeal are set aside to the extent of imposing penalty of Rs,210,000/-. The appellant is directed to deposit the penalty of Rs,10,000/- and Rs,105,000/- and to file all e-returns from July 2011 to March 2013 within two weeks from the date of receipt of this order failing which the Department may initiate appropriate proceedings against the appellant."
5. From perusal of hereinabove finding of the Appellate Tribunal particularly the underlined portion of the Tribunal's order, it appears that the penalty imposed for Non-Registration and to file E- Returns for the period July 2011 to March, 2013 has been confirmed by the Appellate Tribunal, whereas, the penalty of Rs,210,000/- imposed by A department in terms of Table 3 of section 43 has been deleted for the reasons that since, there was no Assessment Order passed under Section 23 of the Sindh Sales Tax on Services Act, 2011, by the Assessing Officer, whereby, the liability of the tax could be determined, therefore the penalty of Rs,210,000/- imposed under Table 3 of Section 43 of Sindh Sales Tax on Services Act, 2011, was not justified, thereafter the said penalty has been set aside by the Appellate Tribunal.
6. We may observe that, in the absence of determination of any sales tax liability through Assessm ent under Section 23 of the Sindh Sales Tax on Services Act, 2011, which may become due towards taxable services, such penalty in terms of Table 3 of Section 43 cannot be imposed. We do not find any error in the impugned order passed by the Appellate Tribunal, Sindh Revenue Board to this effect as it does not depict correct legal position nor the learned counsel for the applicant could controvert the above legal position. Accordingly, we are of the opinion that instant, reference filed by the applicant department under Section 63 of Sindh Sales Tax on Services Act, 2011 is misconceived which is dismissed in limine, whereas, the amended question as proposed hereinabove answered in affirmative against the applicant department.