IHSAN-UL-HAQ CHAUDHARY, J.- lt is proposed to decide Writ Petitions No. 9272/98, 10679/98, 9955/98, 9389/98, 9526/98, 7122/98, 6528/98, 8768/98, 10223/98, 10221/98, 10069/98, 5573/98, 11968/98, 8906/98, 9708/98, 9707/98, 10222/98, 9021/98 & 9301/98 by this single judgment as the point involved is the same.
2. The petitioners are Textile Mills. They have challenged SRO No. 1307( 1 )/97, dated 20.12.1997 appended as Annexure-B issued under Clause (b) of sub-section (1) of Section 8 of the Sales Tax Act. 1990 (hereinafter to be referred as 'Act of 1990') whereby the petitioners were not entitled to reclaim or deduct output tax on the goods, which were not the direct constituent and integral part of taxable goods produced by the petitioners, manufactured or supplied. This petition alongwith some other writ petitions were admitted to regular hearing and notices were issued to the respondents while others have been treated as notice cases with the concurrence of the parties.
3. Learned counsel for the petitioners argued that section 8 is non-ostante clause and the same is to prevail over the provisions if (here is some contradiction but in the present case there is no contradiction in the provisions of Section 7 read with definition of 'taxable goods' and 'taxable supplies' as defined in clauses 39 & 41 of section 2 of the Act of 1990 respectively, in this behalf reference is made to Messrs Elahi Cotton Mills Ltd. V. Federation of Pakistan (1997 pctlr (SC.Pak.)
845).
4. Lt is argued that "Registered Person" under the Act of 1990 is entitled to an adjustment of input tax for all the goods procured as raw material, lt s argued with reference to Section 10 that adjustment is permissible not only on raw material but also plant and machinery, lt is argued that the right of adjustment is confirmed under section 7 read with definition of taxable goods' and 'taxable supplies'. The same cannot be taken away by the impugned notification as all the provisions are to be in harmony, lt is argued that, earlier SRO dated 1.7.1996 was issued under the same provisions and the description of the goods was clearly given, lt is argued that the clause (b) provided for specification of goods. This is lacking in the impugned SRO, therefore, the same is illegal, lt is added that the respondents are fully conscious of this fact, therefore, the impugned notification was substituted by SRO dated 12 6.1998, wherein all the items have been specified, lt is maintained that this conduct of the respondents clearly supports the arguments of the petitioners.
5. Learned counsel for the petitioner while summing up the arguments submitted that the general SRO cannot be issued. The goods have to be specified otherwise it would give un-restricted and un-checked powers to the executive authorities.
6. On the other hand, Mr. A. Karim Malik, Advocate for the respondents argued that the petitions raise disputed questions of fact which cannot be possibly gone into and, decided in Constitutional jurisdiction, lt is added that the petition is pre-mature because petitioners should have waited for order of the competent authority and if aggrieved should have availed the remedies as provided under the Act of 1990. Lt is argued that the goods have clearly been specified in the impugned SRO.
7. I have given my anxious consideration to the arguments of the learned counsel for the parties, gone through the record and relevant provisions of the Act of 1990. The impugned notification was issued under Section 8 of the Act, 1990, therefore, before proceeding any further it is worthwhile to refer to the relevant portion of the said Act which reads as under-
8. Tax credit not allowed. (1) Notwithstanding anything contained in this Act, a registered person shall not be entitled to reclaim or deduct input tax paid on~
(a) the goods used or to be used for any purpose. other than for taxable supplies made or to be made by him;
(b) any other goods which the Federal Government may, by a notification in the official Gazette, specify.
(2)....................
(3)....................
(4)....................
It is clear from the clause (a) that the goods used or to be used for any purpose other than for the taxable supplies are to be excluded, in addition to this the Federal Government is empowered to exclude other goods by virtue of clause (b) above but for this purpose the goods must be specified through a Gazette notification dated 20.12.1997, which is the impugned notification, the goods have not been specified in contradiction to the earlier notification dated 1.7.1996 wherein the goods were specified. The first notification was, however, superseded vide impugned notification.
8. Keeping in view both the notifications in juxtaposition and reading with section 8(1 )(b) of Act of 1990 it is crystal clear that the respondent has authority only to collect sales tax qua the goods specified in the notification issued under section 8 (1)(b) as reproduced above, lt is fiscal matter, therefore, to be interpreted strictly. The second notification did not specify the goods, which is a coalition precedent to collect the tax, therefore, the same is valid to the extent of goods specified in the first notification as the second notification was in continuation of it.
9. The upshot of the above discussion is that the second notification is held valid to the extent of the goods specified in the first notification dated 1.7.1996. The petition is disposed of in the above terms.