MUHAMMAD JAWED ZAKARIA, (JUDIC IAL MEMBER). The titled appeal has been filed under Section 46 of the Sales Tax Act, 1990 at stance of the Appellant calling in question the impug ned order of blacklisting dated 07.02.2017 passed by the CIR, Zone-IV , RTO-II, Karachi under Section 21(2) of the Sales Tax Act, 1990 read with rule 12 of the Sales Tax Rules, 2006. The instant appeal has been filed on the following facts/grounds:--
1. That Mst. Samreen Sohail W/o Sohail Yousuf is the proprietor of the business entity having title Messrs Cosmos International who is a pardanasheen lady conducting business of import and supply of goods having description "Porcelain and Ceramic T iles".
2. That the Appellant being a bona fide citizen of Pakistan voluntarily applied for sales tax registration of her business activities under Section 14 of the Sales Tax Act, 1990 read with Rule 5 of the Sales Tax Rules, 2006 and declared/notified her business address i.e. 89/II, Khayaban-e-Sehar , 23rd Street, DHA, Phase-VI,. Karachi where she lives and operates her business activities/transactions electronically and other wise.
3. That the sales tax registration application of the Appellant was duly processed after physical verification of business address, activities and other relevant documents and sales tax registration was issued by the Department w.e.f. 6.6.201 1 vide STRN 1700231399019 under Rule 5(7) of the Sales T ax Rules, 2006.
4. That after sales tax registration, the Appellant regularly filing all statutory returns and summaries and the taxable liabilities are being discharged accordingly , whereas, the taxable activities, records and assessments of the Appellant are being regularly audited under Section 25 of the Sales Tax Act, 1990 by the officers of the Department.
5. That the Appellant has filed sales tax returns of July 2016 to November 2016 and December 2016 wherein she made correct assessments of her sales tax liabilities and declared correct input, output, unadjusted input tax carried forward and declared verifiable stock of goods lying in godowns/wareho uses hired on rent for relevant business activities having addresses C-134, Sector 6-F, Mehran Town, Korangi Industrial Area, Karachi, C-14, Sector 6-F, Mehran Town, Korangi Indust rial Area, Karachi and C-88, Sector 6F, Mehran Town, Korangi Industrial Area, Karachi which could not be notified under Rule 7 of the Sales Tax Rules, 2006 due to a technical error in electronic system being occurred since July 2016.
6. That suddenly on 30-12-2016, some officers of the Respondent having ulterior motives reached at the registered business address of the Appellant having address 89/II, Khayaban-e-Sehar , 23rd Street, DHA, Phase-VI, Karachi to make raid in the garb of under Section 38 of the Act, 1990 which later on disclosed to be a visit for so called physical verification of available stock and business activities of the Appellant who was out of city, hence, the security guard/watchman had not allowed the officers to enter into the premises of the Appellant in her absence.
7. Thereafter , on the very next day the registration of the Appellant was suspended in haste vide suspension order dated 31-12-2016 passed on public holiday i.e. Saturday in violation of Article 10A of the Constitution of Pakistan, 1973 without placing on record any adverse material against the Appellant who was also not provided any opportunity to confront such material or explain her position, suspension was made on arbitrary recommendations having frivolous/baseless ground of Assistant Commissioner -IR, I&P Cell, Zone-IV , RTO-II, Karachi that the Appellant is not available at her declared business address.
8. That after suspending the registration of the Appellant under Section 21(2) of the Act, 1990 a show-cause notice was subsequently issued on 02-01-2017 under Section 21(2) read with Rule 12 of the Rules, 2006 and para 32(a) of STGO 35 dated 30.06.2012 for blacklisting of registration which was properly confronted by the Appellant and written reply of show-cause notice was submitted on 17-01-2107 duly acknowledged by the Respondent.
9. That the Appellant being aggrieved with the suspension of her registration filed a Constitution Petition D- No. 291 of 201 7 before the Hon'ble Sindh High Court wherein reliance has been made on a judgment/decision passed on 29-11-2016 in a case C.P. D-6303/2016 having similar circumstances wherein it has been held that "suspension of registration is not justifiable where material has not placed on record which could establish allegations of issuance of fake invoices or committing tax' fraud etc and where show-cause notice was not issued to provide opportunity to the taxpayer to confront such material and allegations".
10. That the Hon'ble Sindh High Court heard the grievances of the Appellant and examined all aspects of the case and passed an order on 24-01-2017 which was communicated to the Respondent on 28.01.2017 by the Court Registry wherein specific directions were given to the Respondent to decide the case of the Appellant within the mandatory period of one week having consequence of restoration of registration of the Appellant in case of failure to do so.
11. That the Respondent disobeyed the directions of the Hon'ble Sindh High Court given in the order dated 24-01- 2017 against which a contempt application C.M.A. No. 4045 of 201 7 has been filed against the Respondent who issued the impugned second show-cause notice dated 31-01-2017 wherein baseless allegations have been farmed against the Appellant without placing any adverse material or evidence which could support the allegations and the hearing was fixed on 06-02-2017.
12. The Appellant on 06-02-2017 again confronted the allegations framed in the impugned show-cause notice dated 31-01-2017 and submitted written reply of impugned show-cause notice along with relevant documents and material evidences duly stamped by the Appellant which have acknowledged by the Respondent who neither raised any objection of signatures nor any document/record was asked.
13. That on very next day, the Responde nt being public functionary required to act, fairly, justly , equitably and not unreasonably has passed the impugned order of blacklisting of sales tax registration of the Appellant on 07-02- 2017 in arbitrary and unjust manner without considering and discussing Appellant's written submissions along with supporting documents/record made on 17-01-2017 and 06-02-2017 by committing disobedience of specific directions of the Sindh High Court given in order dated 24-01-2017 passed in C.P. D-No. 291 of 2017, hence, the impugned order of blacklisting is being challenged on the following grounds:- GROUNDS OF APPEAL:-
(1) That the impugned order for blacklisting of registration is arbitrary , illegal, unjust, unreasonable and without lawful authority and the whole proceedings were infested with inherent legal infirmities and are liable to be set aside; a) It is apparent from the case record that the impugned adverse order of black listing of the registration of the Appellant has been passed without any adverse material or evidence which could establish beyond any shadow of doubt that Appellant has issued fake invoices or committed tax fraud etc which is the mandatory requirement for exercise of powers under Section 21(2) for impugned actions and passing of impugned orders. b) It is also apparent from the case record that while passing impugned adve rse order of blacklisting of the registration of the Appellant, the adjudicating officer has not fulfilled the mandatory condition of making substantial justice and decision on merits being quasi judicial authority rather the adjudicating officer has himself defended the case of the Department in arbitrary manner being recovery officer while conducti ng quasi judicial proceedings of adjudication and for this purpose he deliberately and malafidely neither discussed nor considered written submissions and contentions of the Appe llant submitted along with supporting documents/record, such acts and proceedings are misuse and abuse of power and authority which is not permissible and illegal, as such, under the law if the mandatory condition of exercise of jurisdiction was not fulfilled, entire proceedings which follow become illegal and suffer from want of jurisdiction. Relied upon judgments reported in 2008 SCMR 240, 2006 SCMR 1713 and 2016 PTD 485 . c) That the case record discloses that the contentions of the Appellant mentioned in her written reply/response as well as the supporting documents/record submitted on 06-02-2017 have not been rebutted by the Department who has not filed any para-wise comments which-rendered same sustainable under the law being not rebutted, but, despite of that impugned adverse order of blacklisting has been passed against the Appellant in arbitrary manner by preferring departmental favoritism d) That the impugned adverse order of blacklisting has been passed on the basis of charge of "tax fraud" which is defined under section 2(37) of the Act, 1990 which has neither been established nor initial burden of proof has been discharged by the Department, whereas, under the law such charge is required to be established for penal action of blacklisting in accordance with the settled principle of law set by the Hon'ble Sindh High Court in its reported judgments 2004 PTD 868 "that initial burden of proof lies on the prosecution department showing that alleged person knowingly , dishonestly or fraudulently and without any lawful excuse has done the act of commission and omission of offence tax fraud". In support reliance is also made on reported judgment 2014 PTD (Trib.) 558 , e) That the impugned penal action of blacklisting has been initiated merely on allegation that the Appellant has failed to get notified her rented business premises/godowns as per Rule 7 of the Sales Tax Rules, 2006 which are being used for business purposes including stock and delivery of goods etc. Such non notifying of business premises/godowns could attract a penalty of Rs. 5000/-under Section 33(4) of the Sales Tax Act, 1990, but, the business activities of stock and delivery of goods etc being conducting in the aforesaid rented business premises/godowns could not be treated alleged taxable supply/sales under Section 3 of the Sales T ax Act, 1990. f) In the instant, case the impugned order of blacklisting has been passed on the basis of allegation of tax fraud derived from the allegation of issuance of flying invoices to M/s. City Tiles bearing NTN 2310013-3 as framed in the show-cause notice dated 31.01.2017 which was properly confronted by the Appellant with material evidences/documents, however , under the provision of Section 21(2), the adverse action of suspension or subsequent blacklisting could only be taken after establishing the allegation of issuance of fake invoices or committing tax fraud.
The word "fake" has been defined by the Black's Law Dictionary , 8th Edition to be "something that is not what a purports to be" and "to make or construct falsely " at its page 635. Any invoice duty issued under section 23 by a registered person cannot be purported to be a fake document, once it is established that the same is duly incorporated in sales shown by the registered person in his record and also declared in his sales tax return of relevant tax period and particularly where its payment was also made as per procedure prescribed under Section 73 of the Act, 1990. Hence, neither the Appellant involved in issuance of fake invoice nor committed tax fraud as defined under Section 2(37) of the Act, 1990, therefore, the impugned show cause as well as consequent order are illegal, arbitrary and void ab initio. Relied upon reported judgment 2014 PTD (T rib.)558 . g) That the learned CIR without adverting to the questions involved in the instant case has passed the impugned adverse order of blacklisting of registration of Appellant which is not at all speaking order and cannot be called a "judicial order" within the parameters set up by law and the same is also devoid of reasons and is not sustainable under law. It is well-settled law that a "judicial author ity and Court has applied' its independent judicial mind to the issues and points of controversy involved in the causes . h) That the impugned action of blacklisting of registration is illegal and ab initio void because, the whole exercise has been carried out by the learned CIR merely on the basis some assumption or presumption derived from the report of his subordinate i.e Assistant Commissioner I&P Cell. It is well-settled principle of law that nobody can be convicted merely on the basis of some assumptions and presumptions and there is no room for any intendment in the fiscal matters and there is no presumption as to tax. Reliance is made on the reported judgment of Hon'ble Sindh High Court 2004 PTD 868 i) That the impugned order for blacklisting of registration is ab initio void, illegal and without jurisdiction as the authority empowered under the referred provisions of law to suspend or blacklisted a registered person, has to proceed first under section 11 of the Act, 1990 as the case may be for determining the tax liability or as the case may be for recovery of tax not-levied or short-levied or any amount erroneously refunded. It is now well settled principle of law that any exercise conducted without due process of law is illegal and unlawful and without jurisdiction as also laid down by the Honorable Supreme Court of Pakistan in case of "Aftab Shahban Mirani v.
President of Pakistan and others reported as (1998 SCMR 1863 ). j) That it is very astonishing that how a person can be penalized without any proper adjudication and without adjudging any liability against him, such kind of action by the tax functionaries is totally defiance of law which is not permissible under any provisions of law of the land. The act of adjudication under Section 11 had to be done at the first, before taking extreme step of suspension or blacklisting of registration. The act of suspension or blacklisting of registration without adhering to any adjudication as provided under law for determination of tax liability or establishment of charge is equivalent to utter death sentence of a person first and then to order for his investigation and trial thereof. Reliance in this regard is placed on the judgment of a Division Bench of ATIR reported as ( 2012 PTD 337 ). k) That the written reply/submission of the Appellant submitted with material evidences/documents on 06-02-2017 before the learned CIR would be read as part of this appeal and shall be considered while passing order in the instant appeal.
2) That the appeal is within time prescribed under section 46 of the Sales T ax Act, 1990.
3) The Appellant craves permission for its counsel to raise or urge further grounds at the time of hearing of the appeal.
PRAYER In the light of above and as per factual and legal position of the case it is prayed:-- a) That this Hon'ble Appellate Tribunal would set aside the impugned order of blacklisting dated 07-02-2017 being illegal, without jurisdiction, arbitrary and violation of Section 21 and referred judgments of Apex Courts; b) That this Hon'ble Appellate T ribunal would direct the Respondent to restore the registration of the Appellant; c) That this Hon'ble Appellate Tribunal would vacate the show-cause notice being illegal, without jurisdiction, arbitrary and violation of rulings and referred judgments of Apex Courts; Permanently and pending disposal of the main appeal, suspend the operation of impugned order of blacklisting dated 07.02.2017 to maintain the parity and refrain the Respondent from taking any coercive action, orders or notices; e) Grant any other relief deemed fit in the circumstances.
FACTS
2. Brief facts of the case as emanating from the case record are that the Appellant was duly registered since 06-06- 2011 for sales tax under section 14 of the Sales Tax Act, 1990 and rules made thereunder filed sales tax returns for the period from July-2016 to November-2 016 wherein un-adjusted input tax carrie d forward Rs. 47,867,436/- was shown. On 30.12.2016 powers of inspection as provided under Section 38 of the Sales Tax Act, 1990 were exercised by the officers of the Department and thereafter the registration of the Appellant was suspended without giving notice vide order dated 31.12.2016 which was passed by framing the allegations that on working back of the amount of input tax the value of stock in hand comes to Rs. 239,337,180/-(app roximately) which is too high in normal business trends and on physical verification it was found that Appellant's unit did not exist on the declared premises and as such any business activity was observed. Thereafter , the show-cause notice dated 02.01.2017 having same allegations was issued unde r Section 21(2) read with Rule 12 of the Sales Tax Rules, 2006 which was confronted through response submitted by the Appellant who also challenged the suspension of his registration before the Hon'ble High Court of Sindh, Karachi in C.P. D-291/2017 which was disposed of vide order dated 24.01.2017 with directions to the Departm ent to decide the fate of the show-cause notice in view of the response submitted by the Appellant as well as decision of the High Court made in identical case C.P. 6303/2016 having title Messrs Apple Paper Products (Pvt.) Ltd. v. Federation. The Department issued another show-cause notice dated 31.01.2017 by referring Appellant's petition C.P. D-291/2017 wherein it was further alleged that no rented premises/ godown was declared by the Appellant in his registration profile- n terms of Sales Tax Rules, 2006 Chapter-I, para- 7 and no stocks have held in the declared premises as claimed in the sales tax return filed for the period of November , 2016 amounting to Rs. 239,3 37,180/- which had been disposed of by the Appellant without declaring supplies in the relevant sales tax returns. It was also alleged that during the month of December , 2016 the Appellant had declared sales amounting to Rs. 138,919,910/- and charged output tax of Rs. 23,616,378/- without holding stocks, hence, flying invoices were issued in the name of M/s City Tiles without physical transfer of goods which comes under the ambit of tax fraud under Section 2(37) of the Sales Tax Act, 1990. On the other hand the Appellant also confronted the aforesaid show-cause notice and allegations by submitting detailed response/reply along with supporting documents on 06.02.2017 which has been acknowledged by the Department in para-6 of the impugned order . The Department found the submitted response/reply and supporting documents of the Appellant being unsatisfactory for the reasons stated in para-7 of the impugned order , whereafter , the impugned order of blacklisting was passed against the Appellant for blacklisting of its registration since the date of registration i.e. 06.06.201 1. Being aggrieved from the order of Blacklisting passed by the learned Commissioner , the instant appeal has been filed before this Tribunal.
TAXPAYER'S ARGUMENTS
3. Learned counsel appearing on behalf of the Appellant has vehemently contested the case of the Appellant on the grounds of appeal. In addition the learned counsel of the Appellant has argued that impugned order of blacklisting is sticky , slip-shod and devoid of reasons which has been passed in complete disobedience of directions given by the High Court in its order dated 24.01.2017, as such, neither any adverse mate rial has been placed on record regarding establishment of allegations of issuance of fake invoice or tax fraud etc nor the response/ reply of the Appellant has been considered. The AR further argued that the Department has failed to place on record any physical verification report of declared business premises, report of stock in hand with valuation and the statement of watchman regarding non existence of company at declared premises, however , the AR has placed on record Appellant's registration profile i.e. FBR taxpayer online verification showing rented premises/godowns of the Appellant and claimed that alleged stocks are available with the Appellant in its business premises/ godowns which are verifiable at any time by the Departme nt who has already been offered for such exercise of verification in para- 5 of the written reply of show-cause notice 06.02.2017 which is available on record at page-1 17 of the appeal memo, but, the Department deliberately avoided aforesaid exercise as well as notification of rented premises/ godowns which establishes that whole superstructure of the case has been build on thin air and on the basis of presumptions without having any adverse material or evidence. The AR contented that the powers provided under Section 21(2) read with Rule 12 of the Sales Tax Rules, 2006 could only be exercised after complying the mandatory condition of having satisfaction of the Commissioner on the basis of cogent material or evidence for framing and confirming criminal charges of issuance of fake invoices or committing tax fraud/evasion which has not been done in this case. The DR was directed to place on record the physical verification report of declared rented premises/godowns, report of stocks in hand and its valuation, and the statement of watchman regarding non existence of company at declared premis es or adverse material to establish the case of the Department who has failed to place on record aforesaid reports or adverse material which made him unable to confront the grounds and arguments of the Appellant.
D.R's ARGUMENTS
4. The learned D.R. on the other hand, strongly supported the order of the learne d Commissioner and went on to submit that the order of the Commissioner is legal and valid as per provision of law, therefore, the registration of the taxpayer was rightly Blacklisted by the Commissioner .
OPINION OF THE COURT
5. We have heard the arguments of both parties and also carefully examined the relevant provisions of law, documents available on record as well as the order dated 24.01.2017 of the High Court of Sindh Karachi in Petition D-291/2017 filed by the Appellant and the case law referred and cited at the bar .
6. We have found that the Department has not complied the directions of the High Court of Sindh, Karachi given its order dated 24.01.2017 while passing impugned order of blacklisting, particularly , the direction to decide the fate of the Appellant's case in view of the decision made in a case of Messrs Apple Paper Products (Pvt.) Ltd. v.
Federation having similar circumstances bearing C.P. D-6303/2017, as such, we find that no adverse material/evidence has been placed on record regarding establishment of criminal charge of issuance of fake invoices or committing tax fraud etc against the Appellant. We have also observed that the response/replies and supporting documents of the Appellant have been declared unsatisfactory on frivolous/invalid reasons as well as no exercise of proper enquiry or verification of alleged stocks or business activities was conducted by the Department despite of of fer by the Appellant.
7. We have also carefully examined the provision of Section 21(2) and Rule 12 of the Sales Tax Rules, 2006 wherein requirement of being satisfied on part of a Commissioner is mandatory prior to framing and confirming criminal charges of issuance of fake invoices or committing tax fraud/evasion, the said provision and rule entails an enquiry to be undertaken to collect material or evidence by the Commissioner to come to a satisfaction that a drastic action such as suspension or blacklisting of registration is called. The term "satisfaction" is a term of art and connotes that there is enough material to form a definite opinion, on the contrary , in the instant case neither any adverse material or evidence is available on record nor such satisfaction has been made out by the Commissioner which could justify the drastic action of suspension and subsequent blacklisting of Appellant's registration which has deprived her from right of conducting business activities which caused irreparable loss and injury that cannot be compensated for. The argument of the learned AR has been found sustainable that impugned order of blacklisting has been passed beyond the scope and powers of Section 21(2) of the Sales Tax Act, 1990. Therefore, we are of the considered opinion that the Commissioner has failed to comply the mandatory condition of satisfaction as envisage under Section 21(2) of the Act, 1990 for initiation of drastic action of suspension and subsequent blacklisting and he had failed to make out a case of satisfaction that Appellant has issued fake invoices or committed tax fraud as defined under Section 2(37) of the Sales Tax Act, 1990. It is well established principle of law that a party making an allegation must bring material evidence to prove the same and any action which is based upon no evidence is not permitted under the law. It is also well settled law that an adjudication based on mere presumption of fact is not sustainable under Article 117 read with Article 118 of Qanun-e-Shahadat Order , 1984, whereas, the Honourable Sindh High Court, Karachi has held in its judgment in case of Messrs Al-Hilal Motors v. The Collector reported in 2004 PTD 868 that in case of tax fraud initial burden lies on the Department which has not been done in this case.
8. We have also examined the proceedings initiated under Section 21(2) of the Sales Tax Act, 1990 and found that Department issued two show-cause notices dated 02-01-2017 and 31-01-2017 having various allegations which were confronted by the Appellant by submitting response/replies along with supporting documents on dated 17-01- 2017 and 06-02-2017 and we are of the firm opinion that such proceedings were initiated in illegal manner and find that the impugned order of blacklisting is without legs, sticky , slip-shod and devoid of valid reasons. The said order is not at all are speaking order and cannot be called a "quasi judicial order" within the parameters setup by law. The tenor of the order amply manifests non application of judicial mind and no valid reasons have been assigned by the learned adjudicating officer while coming to the conclusion that Appellant has committed tax fraud by issuing fake/flying invoices as defined under Section 2(37) of the Sales Tax Act, 1990 which requires drastic action of suspension and blacklisting of the Appellant since the date of its registration. Even it has been enjoined upon an executive authority , as per Section 24-A of General Clauses Act, 1897 to give reasons for making such orders. Now every officer, authority or a person making any such order is required to give reaso ns and thus any judicial findings without discussing necessary facts and material on record or evidence is not a judicial order and consequently is not sustainable in the eyes of law. In order to maintain sanctity of both quasi judicial and administrative proceedings, it is necessary to maintain check and balance on the performance of adjudicating officers whose orders should not be entirely dependent on opinion and comments of the reporting officers. The Apex Courts have time and again disapproved the passing of such perfunctory orders in the causes involving valuable rights of the parties. Hence, the impugned order of blacklisting which is not a speaking order and devoid of reasons is not sustainable in law being in contravention of law declared by the Hon'able Supreme Court of Pakistan in various cases including Adamjee Jute Mills Ltd. v. The Province of East Pakistan PLD 1959 SC 272, Gouranga Mohan Sikdar v. The Controller Import and Export and 2 others PLD 1970 SC 158 and Muhammad Ibrahim Khan v . Secretary , Minister of Labour and others (1984 SCMR 1014 ) etc.
09. We further hold that suspension, blacklisting as well as non-restoration of registration is an extreme step having paralyzing effect on business of any commercial enterprises and on its financial reputation as well and this type of action also deprived the taxpayer from his fundamental right of conducting busines s under Articles 9 and 18 of the Constitution of Pakistan, 1973 to earn his livelihood such step should be taken as last resort after establishing the gross violation of main factors i.e."(i) if registered person is found to have committed tax fraud and (ii) register person has issued fake invoices" stimulat ing such action of blacklisting or suspension of registration and non of the violations of any of the above referred offences having criminal in nature have been established in the instant case through any material evidence. Apparently , the case is mainly made on allegations of non existence of Appellant on declared premises as well as non holding of stocks declared being un-adjusted input tax carried forward in the sales tax returns of November , 2016 and December , 2016, but in support of these allegations which are found to be based on presumptions no material evidence, report or document etc has been either incorporated in the show- cause notices nor disclosed in the impugned orders nor produced before us despite of our directions for the purpose to discharge initial burden of proof lies on the Department to establish the criminal offence of tax fraud as defined under Section 2(37) of the Act, 1990 against the Appellant as held by the Honorable High Court of Sindh Karachi in case of Al-Hilal Motors Stores and others v. Collector reported in 2004 PTD 868. It is well-settled principle of law that nobody can be convic ted merely on the bases of some assump tions or presumptions and there is no room for any intendment in the fiscal matters and there is no presumption as to tax.
10. Moreover , the impugned penal action of blacklisting has been initiated merely on allegation that the Appellant has failed to get notified her other rented business premises/godowns as per Rule 7 of the Sales Tax Rules, 2006 which are being used for business purposes including stock and delivery of goods etc. Such action of the appellant should be scanned. However , the Commissioner later on at any stage of proceedings did not bother to visit the such business premises/godowns of the Appellant to confirm that stock available at such premises matched with the records of Appellant or any contradiction between the declared records and stocks in hand was found. Mere non-declaration or late declaration of a new business premises/branch/godowns or office by a registered person cannot be considered as tax fraud, except that taxable stocks or taxable business activity conducted on or from such premises has not been declared or reconciled with declared or maintained tax records of the registered person.
11. At this point we reiterate to observe that blacklisting and suspension of a regis tered person is an extreme step having paralyzing effect on business and on its financial reputation as well and such of action should be taken as last resort after establishing the gross violation of main factors. Due to sensitivity and severity of extreme action of black-listing the legislature assigned the powers of suspension and blacklisting under Section 21 to a senior officer i.e. a "Commissioner Inland Revenue" resulting complete standstill of the busine ss of the registered person, on other hand, if an assessment order/order-in-original is passed under section 11 and created tax demands even of billons of rupees, the business remains operative. Basically any order passed under section 11 makes only financial impact on business of only one person. Instead of that suspension or blacklisting of any registered person is equal to complete closure and shutting down of business of such person. Moreo ver, as a result of suspension or blacklisting a Commissioner basically declared transactions made by such person with other registered persons as illegal and void under the provisions of the Act which directly impact legal right of such persons. In other words a blacklisting order creates hundreds or thousands of new litigations under the garb of blacklisting of suspension thereby burdening of appeal in the tax judicial system. Therefore, legislature assig ned powers of suspension and blacklisting under section 21 to a senior officer of Commissioner ranked. Therefore, any proceedings and order of suspension or black listing should be passed after full personal verification, complete scanning, satisfaction and authentication by the Commissioner himself that tax fraud is established on registered person with documented cocrete evidences. Which is totally lacked in this case as it is evident from records of the case that the Commissioner totally based on summary reports of its subordinates without proper supporting evidences.
12. In view of what has been deliberated above, we are shackled by our conscience to hold that the proceedings were initiated and show-cause notices were issued under Section 21(2) of the Sales Tax Act, 1990 for drastic actions of suspension and subsequent blacklisting are without lawful authority and jurisdiction and declared illegal, void ab initio and nullity in the eyes of law and all subsequent actions thereon are also held to be illegal and unlawful and the impugned order of blacklisting is set aside with direction for restoration of registration of the Appellant from the date of its registration immediately .
13. The appeal filed by the Appellant is accepted accordingly .