M.M. AKRAM, JUDICIAL MEMBER .----The above titled appeal has been filed by the registered person directly before this Tribunal under section 46(1)( b) of the Sales Tax Act, 1990 (the Act) against the impugned order of suspension of registration (Sales Tax) vide Order C.No.CIR (District) Zone/1321 dated 22.04.2019 passed under section 21(2) of the Act by the learned Commissioner Inland Revenue (District Zone), RTO, Rawalpindi on the grounds as set forth in the memo. of appeal.
2. It is contended by the learned AR of the appellant inter alia that the aforesaid impugned order was passed without prior notice to the appellant and contains a bald allegation without any reason whatsoever for the penalty imposed which has brought the business of the appellant to stand still. He further submits that the Rule 12(i)(a) of Sales Tax Rules, 2006 inter alia provides that sales tax registration of the person be suspended without prior notice . This is a clear violation of Article 10A of the Constitution of Islamic Republic of Pakistan, 1973. After insertion of Article 10A in the Constitution of Pakistan, 1973, "fair trial" and "due process" are fundamental rights of every citizen for determination of his civil rights and obligations. Before suspension of the sales tax registration of the appellant the reason should be confronted and be given an opportunity of being heard. Reliance is placed on in a recent judgment Sarfraz Saleem v . Federation of Pakistan and others (PLD 2014 SC 232 ) has held: - "4.......... every person; for determination of his civil rights and obligations or in any criminal charge against him shall be entitled to fair trial and due process."
In another case Babar Hussain Shah and another v. Mujeeb Ahmed Khan and another (2012 SCMR 1235 ), the Hon'ble Court has highlighted the import of Article 10A in the words: "11-- concept of fair trial and due process has always been the golden principles of administration of justice but after incorporation of Article 10-A in the Constitution of the Islamic Republic of Pakistan, 1973 vide 18th Amendment, it has become more important that due process should be adopted for conducting a fair trial and order passed in violation of due process might be considered to be void.."
3. In reply , the learned DR submits that according to Rule 12(i)(a) of Sales Tax Rules, 2006, the Commissioner is specifically authorized to suspend the sales tax registration of any person without issuance of prior notice, therefore, according to law the learned Commissioner IR has rightly passed the impugned order and therefore, there is no infirmity in the impugned order . He accordingly prays for rejection of appeal.
4. We have heard both the parties and perused the relevant record. The pivotal issue involved in the instant appeal is as to whether Rule 12(i)(a) of Sales Tax Rules, 2006 offends the provisions of Articles 10A and 18 of the Constitution of Islamic Republic of Pakistan, 1973 and impinges upon the right of the appellant to be treated in accordance with law and by due process of law as well as affects the right of the appellant to conduct trade and business as enshrined in Article 18 of the Constitution? This specific question came before the Hon'ble High Court in the case titled as "M/s. Imran Ali Lubricants v. Federation of Pakistan and others "(2018 PTD 1042 ) wherein the rule 12 to the extent that it provides for suspension of registration of a registered person without prior notice was held to be declared ultra vires the Constitution as well as the main enactme nt and was struck down in the following manner: - "19. Besides, it is an immutable principle that in all proceedings whether judicial or administrative, the principles of natural justice have to be observed if the proceedings might result in consequences affecting the person or property or other right of the parties concerned. Therefore, where a person is empowered to take decisions after factual investigation into the facts which would result in consequences affecting the person, property or other right of any other person, then the courts have inclined generally to imply that the power so given i.e., coupled with a duty to act in accordance with the principles of natural justice and fairness. [The University of Dacca through its Vice-Chancellor and the Registrar , University of Dacca v.
Zakir Ahmed (PLD 1965 Supreme Court 90)].
20. Undoubtedly the power of suspension of registration without prior notice is unlawful and impinges upon the rights of the petitioners to be treated in accordance with law and to be afforded due process of law. "(Emphasis supplied)"
The ratio decided by the Hon'ble High Court in above judgment, is now upheld by the Division Bench of the Hon'ble High Court vide its order dated 14.03.2019, in 2019 PTD 1213 .
5. By following the ratio decided by the Hon'ble High Court, the appeal of the appellant is accepted and the impugned order is set aside with the direction to he respondent to restore the sales tax registration number of the appellant forthwith in its original status i.e List of Active Taxpayer .
6. Appeal is disposed of in above terms. This order consists (03) pages each page bears my signature.