Babar Sattar, J:- This reference emanates from order of the Appellate Tribunal Inland Revenue, Islamabad ("ATIR") dated 04.10.2010 pursuant to which a demand for collection of federal excise duty in the amount of Rs.8,360,553/- pursuant to Order-in-Original dated 02.03.2000 were set aside.
2. Learned counsel for the tax department submitted that the matter related to collection of excise duty for sale of bulk cement in loose form. The taxpayer sought to pay excise duty at the contractual price agreed between the petitioner and the purchaser Ghazi Barotha Contractor even though the retail price at which the product was available to the general body of retail traders at the time was higher. Through the assessment order the tax department sought the collection of short payment together with an additional duty at the rate of 2% per month under section 3(b) of the Central Excise Act, 1944 ("1944 Act"), and a penalty for Rs.100,000/- for non-compliance with provisions of the 1944 Act. The demand was upheld by the Tribunal and in a reference filed before the High Court, the High Court by order dated 13.05.2009 remanded the matter back to the Tribunal after which it passed the impugned order and set aside the assessment order and the demand raised. He submitted that such order was not in accordance with section 4(2) of the 1944 Act.
3. Learned counsel for the respondent submitted that no question of law arose from the order of the Tribunal. In the said order the Tribunal had taken into account the fact that the product sold by the taxpayer to Ghazi Barotha Contractors was a bulk sale of cement in loose form as opposed to sale of cement bags and the tribunal while relying on the case law including, inter-alia, Crescent Textile Mills Ltd. Lyallpur Vs. Member, Central Board of Revenue (Central Excise), Islamabad (1980 SCMR 773), Crescent Textile Mills Ltd. Lyallpur Vs. Member, Central Board of Revenue (Central Excise), Islamabad (1989 CLC 2045 Peshawar), Souvenir Tobacco Co. Ltd. Vs. Deputy Collector, Central Excise and Land Customs (1989 CLC 1134) and Government of Pakistan Vs. Hashwani Hote Limited (PLD 1990 SC 68) found that the packaging of a product was to be taken into account while determining the retail price and based on packaging there could be a price differential even when the underlying product was the same. He further submitted that the Tribunal took into account the fact that prior to declaring the retail price of cement the taxpayer wrote to the Assistant Collector, Federal Excise conveying that the price of the product was Rs.2538.45/- per metric ton, which was not agreed to by the Assistant Collector. The matter was brought before the Central Board of the Revenue (now Federal Board of Revenue "FBR") and by letter dated 28.09.1996, FBR directed the Collector, Rawalpindi to decide the issue in accordance with the law. Subsequently by letter dated 18.12.1996 the Assistant Collector, Central Excise, Islamabad communicated to the taxpayer that the competent authority had been pleased to accept the retail price declared for supply of cement to Ghazi Barotha Contractors at Rs.2538.48/- per metric ton and directed that such price be printed on the bowsers and also be published in the National daily newspapers. He submitted that letter dated 08.12.1996 was issued pursuant to the power vested in the Federal Government under section 4(2) of the 1944 Act and it was consequently held by the Tribunal that once such price was accepted by the Collector and communicated to the taxpayer by the Collector, the tax department could not renege on the acceptance of the price and seek to charge additional excise duty on the basis of retail price for cement bags available to the general body of retail traders.
4. A perusal of the order of the Tribunal reflects that two factors prevailed with the Tribunal. One, that the product sold by the taxpayer to Ghazi Barotha Contractors was bulk sale of cement in loose form (i.e. not bagged), and the Tribunal after relying on case law concluded that the said product by virtue of not being packaged was different from cement sold in bagged form. And by virtue of the difference in packaging it could not be said that the retail price of cement in loose form ought to be the same as the retail price fixed for sale of cement in bagged form. And two, the tax department had accepted the retail price agreed between the taxpayer and Ghazi Barotha Contractors for purposes of section 4(2) of the 1944 Act. And the value of the product as agreed to by the Federal Government was communicated by Assistant Collector through letter dated 08.12.1996, after which the question of price of the product became settled. Therefore, when the show cause notice for purposes of collection of federal excise at a higher rate was raised on 15.07.1999 the question of price as agreed to by the Collector under the direction of FBR was a past and closed transaction.
5. We are not convinced by the arguments of the learned counsel for the tax department that there is a question of law that emanates from the order of the Tribunal. The Tribunal as a factual matter has determined that the product sold by the taxpayer to Ghazi Barotha Contractors (i.e. bulk sale of cement in loose form) was different from the product the retail price of which was being taken into account by the tax department for purposes of generating excise duty demand against the taxpayer (i.e. cement in bagged form). In our reference jurisdiction we cannot second guess a factual determination made by the Tribunal. The second factor that prevailed with the Tribunal was that FBR had directed the Controller to determine the price for bulk supply of un-bagged cement, which was determined at Rs.2538.48/- per metric ton as communicated to the taxpayer by letter dated 08.12.1996 written by the Assistant Collector. This letter states that the competent authority has been pleased to accept the retail price for the product supplied by the taxpayer. The Tribunal, as a matter of fact, also determined that the competent authority referred to in letter dated 08.12.1996 was the Federal Government for purposes of section 4(2) of the 1944 Act. The tax department now seeks to raise a factual question as to whether the Assistant Collector was vested with authority by the FBR at the relevant time to issue such letter accepting the retail price of cement as proposed by the taxpayer. This once again involves determination of a fact which the Court cannot undertake in its reference jurisdiction. In the event that any such objection to lack of authorization of the Assistant Collector was to be taken, it ought to have been done before the Tribunal. This was not done as the Tribunal has observed in para-07 of its order that it confronted the tax department with the content of the letter of Assistant Collector date 08.12.1996 whereby the retail price of Rs.2538.48/- per metric ton was accepted and representative of the tax department had no explanation to offer in such regard.
6. For the aforementioned reasons, we find that no question of law arises from the order of the Tribunal. The reference is without merit and is dismissed. A copy of this order is directed to be sent to the Registrar of the Tribunal under the seal of this Court.