SAIF ULLAH KHAN, ACCOUNT ANT MEMBER .---This appeal has been filed by the Appellant/Registered Person against the Order-in-Appeal No.44/2018, dated 30.06.2018, passed by the learned CIR (Appeals-V), Karachi. The Appellant has agitated following grounds of appeal.
1. That the impugned appellate order as well as assessment order are arbitrary , illegal, without lawful authority and void which are liable to be annul or set aside: - a) That in the impugned appellate order neither grounds of appeal have discussed nor confronted/rebutted nor counter comments/cross objections have been filed by the Respondents nor any further inquiry was conducted as may be necessary , but, despite of that the assessment order creating tax liability has been confirmed which established that proceedings of the Appellate Authority were arbitrary , partial and based on Departmental favoritism. b) That the Appellate Authority without disclosing reasons has given findings which are not supported with any adverse material or evidence or physical verification report of business activities and premises who has also deliberately not considered the law and the case laws/decisions of higher forums and Courts referred by and applicable in the Appellant's case which is illegal and arbitrary exercise of powers and authority . c) That the sales tax registration of the Appellant made after due process under section 14 of the Sales Tax Act, 1990 for manufacturing facilities and activities has not been objected/questioned while framing and establishing allegations against the Appellant which rendered the whole proceedings and orders being baseless and arbitrary reliable to be annulled. d) That the contents of the show-cause notice and findings of the Assessing Officer and Appellate Authority are contradictory , as such, in one hand the Department contending that subject goods of textile requires manufacturing process of dying, cutting and stitching to transform the same in the form of finished goods ready for use by general public which covered under section 2(16) of the Sales Tax Act, 1990, but, on the other hand the Department contending that the same subject goods are in finished form which are liable to be taxed at the rate of 6% on the basis of which the whole super structure of the case has been built and impugned orders have been passed which are arbitrary , illegal and not sustainable in law particularly as per definition of manufacturing provided under section 2(16) of the Sales T ax Act, 1990. e) That the alleged textile goods i.e. ladie s/gents shirting, suiting fabric is usable as industrial input which required manufacturing process, such as, dying, cutting or stitching etc as defined under Section 2(16) of the Sales Tax Act, 1990, hence, supply of the same in same state is chargeable to zero percent sales tax as per condition No. (vii) of the SRO 1125(1)/201 1 dated 31-12-201 1, therefore, the impugned orders and tax demand are illegal, arbitrary and violation of SRO 1 125(1)/201 1 dated 31-12-201 1. f) That the Adjudicating Officer prior to passing impugned order has not conducted any exercise of fact finding inquiry regarding establishment of charges framed in the show-cause notice, therefore, the whole proceedings and impugned order are based on some assumptions or presumptions which are unjustified and liable to be stuck down. Reliance is made on Sindh High Court judgment Al-Hilal Motors v . Collector reported in 2004 PTD 868 . g) That neither in the show-cause notice nor in the impugned orders the so called physical verification report of the registered business premises and manufacturing facilities and activities of the Appellant and its contents have been disclosed on the basis of which the allegations have been framed and established against the Appellant, therefore, impugned orders have been passed in arbitrary manner on the basis of no evidence which is not sustainable in law . h) That the Adjudicating Officer and Appellate Authority were exercising powers being quasi-judicial authority having duty and responsibility to do substantial justice without any partiality or favoritism but both have not discharged their aforesaid duty and responsibility and passed the impugned orders against the Appellant by defending the case of the Department. Therefore, the impugned orders have been passed on the basis of partiality and favoritism in violation of principle of natural justice. i) That after filing of relevant returns unde r Section 26 of the Sales Tax Act, 1990 the jurisdiction stood vested with the Legal Division in the instant case of the Appellant, the jurisdiction is therefore vested with the Officer of Inland Revenue of Legal Division to assume jurisdiction of adjudication of the instant matter and issuance of assessment order under section 11(5) of the Sales Tax Act, 1990 in terms of FBR's letter C.No. 1(15)IR-JUD/2007 dated 11.11.2007, hence, the ACIR, .1.1 and Prosecution Cell, Zone-I, RTO-III, Karach i being Adjudicating Authority in this case lacked jurisdiction. It is an elementary principal of the law that if a mandatory condition for the exercise of jurisdiction by a Court, Tribunal or Authority is not fulfilled, than the entire proceedings which follow become illegal and Suffer for want of jurisdiction and any order passed in continuation of these proceedings in appeal and revision equally suffer from illegality and or without jurisdiction, reliance is made on the judgments of august Court of Pakistan in case of Mansab Ali v. Amir and others (PLD 1971 SC 124) and lzhar Alam Farooqi v. Sheikh Abdul Sattar Lasi (2008 SCMR 240 ) and Peacock Restaurant v . CIR reported in 2012 PTD (T rib.) 478 . j) That the allegations have been framed and established in the impugned orders without discharging burden of proof as per Articles 117 and 118 of the Qanun-e-Shahadat Order , 1984, as such, under the law i.e Articles 117 and 118 the party making an allegation must bring 'Material evidences to prove the same and any action which is based upon no evidence is not permitted by any law, adjudication in the instant case is only based on mere presumption of facts is not sustainable under Article 117 read with Article 118 of the Qanun-e -Shahadat Order , 1984. Relied upon reported judgment 2016 PTD 485 . k) That the impugned orders have been passed on the basis of no reasons without fulfilling requirement of Section 24A of the General Clauses Act, 1897, therefore,. the impugned orders are illegal and without jurisdiction. l) That stereo type formula orders have been passed against the Appellant in violation of principle of natural justice.
Therefore, the impugned orders are illegal and based on mala fides as well as Departmental favoritism. m) That the allegation of tax fraud against the Appellant has been framed and established in the impugned orders without discharging initial burden of proof by the Department as held by the Sindh High Court judgment Al-Hilal Motors v. Collector reported in PTCL 2003 CL.01 . Therefore, the impugned orders are illegal, arbitrary and based on mala fides. n) That the impugned ex parte assessment is bad in law which was made without furnishing requisite notice on the date which was not fixed for hearing. The Honorable Lahore High Court has held in its judgment in case of Messrs Crescent Textile Mills Ltd. v. Commissioner of Income Tax reported as 1981 PTD 213 that "The Income Tax Officer has acted illegally in making ex parte assessment on a date which was not fixed for hearing without furnishing the assessee with requite notices, such ex parte assessment was bad in law". o) That the penalty proceedings under sections 34 and 33(13) of the Sales Tax Act, 1990 being criminal nature, it was mandatory for the Department to establish, mens rea or wilful tax evasion against the Appellant beyond any reasonable doubt on the basis of material evidences of higher standard. In the instant case no such material evidence has been placed on record which could established the charges and mens rea or wilful tax evasion against the Appellant. Relied upon reported judgments 2016 PTD 485 and 1987 SCMR 1840 as well as the following judgments:--
1. 2004 SCMR 456 = 2004 PTD 1 179 D.G. Khan v . Federation of Pakistan.
2. 2002 PTD (T rib.) 3000 Nestle Milk Pak v . A: Collector
3. 2005 PTD 1984 Collector v . Coca Cola
4. 2005 PTD 1978 Collector v . Kashif Enterprises
5. 2005 PTD 1953 Collector v . Farooq T raders
6. 2003 PTD 1445 Millat T ractor v . Collector
7. 2004 PTD 2771 Ghandhara Nissan v . Sales T ax
2. That the facts and grounds of the Appellant submitted before both the forums below would be read and considered as part of this appeal.
3. That the appeal is within time prescribed under section 46 of the. Sales T ax Act, 1990.
4. That the appeal fee amounting to Rs.2,000/- has been deposited.
5. The Appellant craves permission for its counsel to raise or urge further grounds at the time of hearing of the appeal.
2. Brief facts of the case are that the appellant is an individual and registered for Sales Tax as engaged in the business of manufacture, imports, exports and wholesale of textile goods. The Assessing Officer on scrutiny of record and physical verification report observed certain discrepancies regarding-mis-declaration in registration profile, misuse of manufacturing status and non-payment of sales tax. The ACIR accordingly initiated proceedings and ultimately passed order under sections 11(2)/1 1(3) of the Sales Tax Act, 1990 to recover Sales Tax of Rs.31,426,397/- along with default surcharge wider section 34 and 100% penalty under section 33(13) of the said Act.
3. Being aggrieved, the registered person filed appeal before the learned CIR(A), Karachi, who confirmed the order of the ACIR. Hence, this appeal has been filed before this Tribunal.
4. On date of hearing, Mr. Aqeel Ahmed, Advocate appeared on behalf of the Appellant/Registered Person while Mr. Mukhtar Ahmed Shar appeared on behalf of the Department.
5. During proceedings before this Bench, the learned AR stated that the appellant imports big rolls of finished cloth which are cut into small rolls and sold. The learned AR further stated that the appellant is registered as manufacturer and said cutting of finished cloth into small rolls is manufacturing activity in terms of clause (c) of section 2(16) of the Sales Tax Act, 1990. The learned AR argued that the Respon dent/Department has filed para- wise comments in which the Respondent/Department has not challenged the sales tax registration of the Appellant as manufacturer which is an admission of manufacturing activities of the Appellant. The AR further pointed out that as per condition (ii) of SRO. 1125(1)/201 1 dated 31.12.201 1 goods usable as industrial inputs including fabric is chargeable to 0% sales tax if imported for in-house consumption by registered manufacturers of textile sector .
Moreover , as per condition (vii) of SRO.1 125(1)/201 1 dated 31.12.201 1 supplies of finished fabric to manufacturers of textile sector specified in condition (i) of said SRO are also chargeable to 0% sales tax. The AR contended that the Appellant has valid and admitted sales tax registration as being manufacturer and doing activities of textile manufacturing including cutting etc. as defined under Section 2(16) clause (c) of the Sales Tax Act, 1990. The AR argued that Appellant made supplies of fabric to registered manufacturers doing business in textile sector specified in condition (i) of SRO. 1125(1)/201 1 dated 31.12.201 1, therefore, the case and demand of sales tax by the Department is not sustainable and arbitrary . The AR further objected to the first physical verification report submitted by the DR with the para-wise comments and contended that no any reference of this report or its contents have been mentioned or incorporated in the case record and he alleged that it has been falsely prepared after directions of the Tribunal, as such, falsity of said report is apparent from the second physical verification report submitted by the DR. Finally , the AR argued that whole case has been made without placing on record any adverse material or evidence and order passed by the of ficer is only on the basis of presumptions.
6. The learned DR supported the order of the learned CIR(A) and argued that the appellant/registered person failed to establish its status of being a manufa cturer and did not carry out any further manufacturing process on the finished fabric imported. He further argued that the registered person/taxpayer was not eligible to avail the benefits of being a manufacturer , because conditions laid down under the provisions of section 2(16) of the Sales Tax Act, 1990 were not fulfilled. The appellant in fact imported finished fabric, which were imported on zero-rated basis on the false claim of being a manufacturer . He stated that the benefit of zero-rating are not admissible on finished fabric if it is not used in any manufacturing, hence, the appellant was required to pay sales tax along with value addition tax at import stage on the import of finished fabric.
7. We have heard the rival parties and perused the record of the case. Before proceeding further , we think it beneficial to reproduce the operative part of the impugned order of the learned CIR(A), Karachi, which reads as under: "The impugned order established that the appellant failed to establish its status of being a manufacturer; and did not carry out any further manufacturing process on the finished fabric.
The appellant was not eligible to avail the benefits of being a manufacturer; therefo re, the provisions under section 2(16) of the Act were. not fulfilled on the imported finished fabric which were imported on zero-rated basis on the claim of being a manufacturer . The benefit of zero-rating is not admissible on finished fabric if not used in any manufacturing. Thus, the appellant was correctly required to pay sales tax along with value addition tax at import stage on the import of finished fabric.
Considering all factual and legal aspects, the impugned order being on sound footing, is endorsed. The appellant's grounds of appeal and arguments fail to hold ground, and in view of the above discussed facts and the legal provisions, I do not find any compelling reason to interfere with the impugned order which is hereby confirmed."
8. The core issue involved is whether the appellant is a manufacturer or not. Admittedly the appellant imports finished cloth in big rolls which are cut into smaller rolls and sold. On the basis of said activity the appellant claims to be a manufacturer and entitled to bene fits of SRO No.1125(I)/201 1 dated 31.12.201 1. The main argument, of the learned AR revolves around definition of manufacturer provided under section 2(16) of the Sales Tax Act, 1990 and in particular its clause (c). The learned AR also tried to take shelter of conditions (ii) and (vii) of SRO No.1125(I)/201 1 dated 31.12.201 1 and claimed that since cloth imported by the appellant was useable as industrial input hence appellant was entitled to the benefits of said SRO.
9. It is appropriate to refer definition of manufacture and manufacturer as provided in Sales Tax Act, 1990. Under section 2(17) of the Act a manufacturer is a person engaged in manufacture of good. The word manufacture is defined under section 2(16) as a process whereby an article singly or in combination with other articles is either converted into another distinct article or it is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly . Such activity includes processes incidental or ancillary to the completion of a manufactured product, processes of printing, publishing, lithography and graving and process and operations of assembling, mixing, cutting, diluting, bottling, packaging, repacking or preparation of goods in any other manner .
10. The said definition under section 2(16) comprises 03 clauses which are connected with each other through a semi-colon between clauses (a) and (b) and word "and" between clauses (b) and (c). It is also pertinent to note that clause (a) starts with words "any process" while clauses (b) and (c) start with word "process" which further elaborates the words "any process incidental or ancillary" used in clause (a). These details manifestly explains that all the 03 clauses of Section 2(16) are interconnected and it is a compact definition of "manufacture or produce".
11. The Hon'ble Supreme Court of Pakistan has recently in its judgment reported as 116 Tax 13 thoroughly discussed both the definitions provided in sections 2(16) and 2(17) of the Sales Tax Act, 1990. The relevant portion is reproduced as follows: PLD 2017 SC 99 'Manufacturer' has been defined in Section 2(17) of the Act which reads as under: "2(17) "manufacturer" or "producer" means a person who engages, whether exclusively or not, in the production or manufacture of goods whether or not the raw material of which the goods are produced or manufactured as owned by him; and shall include-
(a) .........................
(b) ........................
(c) ........................
Provided that ........................................"
'Manufacture' has in turn been defined in Section 2(16) of the Act which reads as follows:- "2(16) "manufacture" or "produce" includes:-
(a) any process in which an article singly or in combination with other articles, materials, components, is either converted into another distinct article or product or is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly and includes any process incidental or ancillary to the completion of a manufactured product;
(b) ..........................
(c) .........................
We reiterate that there is no cavil with the principle that a charging .provision in a fiscal statute is to be given a strict interpretation and if a case does not fall within Nit purview thereof, tax cannot be charged from a person from whom it is being claimed. As is 'clear from Section 3 of the Act, sales tax can only be charged/levied against a person who makes a taxable supply which has been defined in Section 2(41) of the Act which specifically and unequivocally provides that, it is supply of taxable goods by inter alia a manufactur er. According to section 2(17) of the Act a manufacturer is a person who engages in the manufacture of goods and therefore, the definition of manufacture provided in Section 2(16) of the Act becomes germane in the instant case. It is settled that a definition clause is foundational when constricting provisions of law. The definition given in the Act should be so construed as not to be repugnant to the context and would not defeat or enable the defeating of the, purpose of the Act. It must be read in its context and the background of the scheme of the statute and the remedy intended by it. A. bare reading of the definition of 'manufacture' suggests that it is a process where: -
(i) an article singly or in combination with other .articles, materials, components, is either converted into another distinct artide or product; or
(ii) an article is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly; and
(iii) includes any process incidental or ancillary to the completion of a manufactured product.
Does the process of sterilization of the syringes/surgical products convert them into a.distinct article or product or is the article (syringes) changed, transformed or reshaped? The answer will depend on the meaning attributed to said words. It may be pointed out at this juncture that the part of Section 2(16) of the Act "any process incidental or ancillary to the completion of a manufactured product" is ejusdem generis to the earlier part of the definition [paragraphs (i) and .(ii)]. The alleged manufacturing activity must fall Within the first two categories else the third category would have no independent application or legal significance. Returning to the issue at hand, the words 'convert' 'change' transform' and 'reshape' are important. Chambers 21st Century Dictionary has defined them as follows:- "Convert to change the form or function of one thing into another; Change - to make or become different; Transform - to change in appearance, nature, function, etc. often completely and dramatically; Reshape - to form or fashion or to give a particular form to something, again, or again and in a different way ."
The Concise Oxford Dictionary (1982 ed.) has assigned the following meanings: "Convert - change; change in character or function; Change - making or becoming different; Transform - make change in the form, outward appearance, character , disposition, etc Reshape - create, form, construct, mode l, mould, fashion, bring into desired or definite figure or form once more, again, afresh."
Further , 'sterilization' means "the treatment of food, surgical or laboratory equipme nt, etc. with heat, chemicals or radiation in order to destroy all living micro-organisms":
5. Adverting to the case law referred to by the learned counsel, the cases of Mahboob Industries (supra) and Adil Polypropylene Products (supra) pertain to excise and are therefore not relevant to the instant matter . In Shekhoo Sugar Mills (supra) this Court held that the definition of the word 'manufacture' in Section 2(16) of the Act clearly suggested that the bagasse produced during the extrusion of sugarcane had an independent identity , status and character and was capable of being put to use differently therefore it fell within the said definition, therefore supplying bagasse fell within the definition of taxable supply .
6. From the facts of the present case, it is quite clear that the activity of gamma sterilization, which the respondent is engaged in - a process that eliminates all forms of living organisms = does not involve the conversion of any article 'singly or in combination with other articles into another distinct article or product. The process does not change, transform or reshape the syringes in any way, thereby rendering them capable of being put to use differently or distinctly . The syringes remain, syringes after sterilization. Therefore, a bare reading of all the aforementioned definitions in their legal and usual context makes it manifest that the process of sterilization of medical/surgical products does not fall within the meaning of 'manufacture' as provided in Section 2(16) thus the respondent is not a 'manufacturer' under Section 2(17) and is not making a 'taxable supply' as per Section 2(41) and therefore cannot be charged to sales tax under Section 3 of the Act. In light whereof, this appeal is dismissed.
12. The Hon'ble Lahore High Court in its judgment reported as 2002 PTD 470 has also discussed definition of manufacture or produce as provided in Section 2(16) of the Sales Tax Act, 1990. The relevant portion is reproduced as follows: "4. Now the taxable activity is defined in Section 2(35) of the said Act to mean any activity which is carried on by any person, whether or not for pecuniary benefit and involves in whole or part the supply of goods to any other person, for any consideration or otherwise, includes any activity carried in the form of business, trade or manufacturing. I may reproduce here. Section 2(16) of the said Act which defines manufacture or produce:- "Manufacture" or "produce" includes:-
(a) any process in which an article singly or in combination with other articles, materials, components, is either converted into another distinct article or product or is so changed, transformed or reshaped that it becomes capable of being put to use differently or distinctly and includes any process incidental or ancillary to the completion of a manufactured product;
(b) process of printing, publishing, lithography and engraving; and
(c) process and operations of assembling , mixing, cutting, diluting, bottling, packag ing, repacking or preparation of goods in any other manner ."
Now so far as the said sub-clause(a) of the said Section 2(16) is concerned, the same fully supports the said contention of the learned counsel for the petitioner when he contends that the process of manufacture involves conversion of one article singly or in combination with other articles and components into a distinct article or product or in the process the original article is so changed, transformed or resha ped that it becomes capable of being put to use differently or distinctly . Mr. Izhar -ul-Haq Sh., Advocate, does not question the factual position that the Pipe fittings are not transformed into a different article which can be put to any other distinct use when they are galvanized and threaded. He, however; places implicit reliance on the clause (c) of the said Section 2(16) to argue that any process applied to imported article would constitute manufacture as defined in the said Section 2(16). The learned counsel for the petitioner on the other hand is of the opinion that clauses (b) and (c) of said section 2(16) are not to be read independently but rather to be read into, as part of or in continuance of clause (a). The precise contention is that the processes mentioned in clauses (b) and (c) would constitute manufacture only with reference to initial process of manufacture as stated in the said clause (a). I may state here that the learned counsel relies on the case Deputy Collector Central Excise and Land Customs Lahore v. Chairman C.B.R. Islamabad (PLD 1992 SC 364). I have examined the said judgment and to my mind it does support the learned counsel for the petitioner so far as the contents of said clauses (a) of Section 2(16) is concerned. However , in the present case the said clause (b) and (c) of the said section 2(16) are also to be considered. To my mind, so far as the facts and circumstances of the present case in particular are concerned, no withstanding the too wide workings used in clauses (b) and (c) the galvanization and threading of the pipe fittings which do not at all convert the said articles into any other distinct articles or change or transform their shapes, do not bring the said act of threading and galvanizing within the mischief of said clause (c). Judicial notice can safely be taken of the common place and fact that the Pipes which people purchase are normally threaded by Plumber who installs the Pipe fittings. This certainly is not a process of manufacture similarly galvanizing the said articles would not constitute the said process. The said acts certainly do not fall within the ambit of assembling, mixing, cutting, diluting, bottling, packaging and repacking; and threading and galvanizing cannot be termed as preparation of the said goods. I, therefore, do find that the petitioners are not involved in process of manufacture in the matter of said Pipe Fittings imported by them as such they are not liable to pay Sales tax as manufacturer having paid it at the import stage. It is however , clarified that this judgment will not have application to any other taxable activities carried on by the petitioners. With these observations, this writ petition is allowed. The act of galvanizing and threading Pipe Fittings imported by the petitioners, having paid the Sales tax on import stage is declared not to be process of manufactured so as to make the petitioners liable to pay the tax as manufacturer of the said goods/articles. No order as to costs."
13. We would also like to refer to two decisions of the learned Tribunal wherein the term manufacture has been discussed. Relevant portions of said decisions are as follows: 2006 PTD (T rib) 1056
13. In the light of above observations, we are of the opinion that respondents action to treat tea bag/paper bag as an act of "manufacture" was wrong as in fact no independent product ever came into existence from the process of inserting the paper with the blended tea which in fact is a necessary act to use the paper pouches. In our view the contravening act never assumed the status of manufacture, therefore demand of duty on paper bags used in the packing of tea as a result of a continuous process was not justified. The appeal is accordingly allowed and the impugned order is set aside.
2004 PTD (T rib) 1328
9. Here the harvested tobacco, cured tobacco, cut tobacco, stemmed tobacco, dried tobacco and re-dried tobacco is neither converted into any other distinct article or is changed, transformed or reshaped to make it capable of being put to use differently and distinctly . The tobacco, whether harvested, cured, but, dried or re-dried, remains an un-manufactured tobacco and the process carried out are for preservation of the tobacco, for preservation of its aroma, for ease of packing, to prevent mould or drying and the reshaping (cutting, stemming, stripping, packaging, casing) is not for putting it to use any differently . All these processes are incide ntal or ancillary to prepare (not manufacture) the un-manufactured tobacco fit for being manufactured into a manufactured tobacco or a smoking tobacco like cigarettes, cigar , cigarillos, cheroots, or smoking tobacco. We are of the view that unless the un- manufactured tobacco commences the stage of conversion into a smoking tobacc o (or manufactured tobacco), it cannot be called a transformation, conve rsion or change to alter its character as an un-manufactured tobacco.
Neither any new article or new product is obtained by the processes of curing/re-drying nor is the un-manufactured tobacco converted into a manufactured tobacco. Even the commodity classification and coding does not change.
Tobacco, before curing/re-drying and even thereafter , remains classifiable under H.S. Code 24.01 as un- manufactured tobacco. In even C.B.R.'s letter C.No.3(41) STP/98, dated 18-6-1 999, it is stated that Re-dried tobacco falls under P.C.T. Hdg 2401.1000. However , we do not agree with the C.B.R. that the process of redrying is covered by the terminology "manufacture or produce" under section 2(16) of the Act. Both the words "process" and "manufacture" are distinct and the word "manufacture" essentially means to bring a new article into the market.
Although, certain processes have been specifically included in the definition of manufacture i.e. at clauses (b) and
(c) of section 2(16) of the Sales Tax Act, 1990, the process of curing, drying and re-drying of un-manufactured tobacco has not been included there. The processes of cutting, packaging and repacking, as used in clause (c) of section 2(16) do not affect the outcome of this case because these processes are carried on un-manufactured products (un-manufacture tobacco) and the products/article still, after such cutting / packing/repacking remain un- manufactured products (un-manufactured tobacco) without any change in use, nature, demand and clientele.
14. In view of the above judgments of the Hon'ble Supreme Court of Pakistan and Hon'ble High Court Lahore as well as decisions of the learned Tribunal it is clear that manufacture means a proce ss whereby an article signally or in combination of other articles converts into another distinct article. In the instant case the appellant is admittedly importing finished cloth and sell the same after cutting it into smaller rolls. The appe llant has imported finished cloth and sold it in same form without any process of manufacture. Hence the appellant was not entitled to benefits as manufacturer under SRO No.1 125(I)/201 1 dated 31.12.201 1.
15. The learned AR of the appellant's alternate contention regarding clauses (ii) and (vii) of SRO No.1125(I)/201 1 dated 31.12.201 1 is also of no help beca use appellant is not a manufacturer as per provisions of Section 2(16) of the Sales Tax Act, 1990 and finished cloth is not sold as industrial input.
16. In the light of above discussion and respectfully getting guidance from the judgments of the Hon'ble Supreme Court of Pakistan and Hon'ble High Court Lahore as well as decisions of the learn ed. Tribunal, we are of the firm opinion that the appellant is not a manufacturer hence not entitled to benefits of SRO No.1125(I)/201.1 dated 31.12.201 1 available for a manufacturer .
17. Keeping in view facts and circumstances of the case and above discussion, we are not inclined to interfere, hence order of the learned IE CIR(A) is upheld.
18. The appeal is decided in the manner as indicated above.