CHIEF JUSTICE MAMOON KAZI.-(l). The petitioners received a show-cause notice, dated 26.3.1995 from Deputy Collector, Collectorate of Customs and Central Excise, Hyderabad, calling upon them to show cause as to why recovery of Sales Tax amounting to Rs. 93,89,972 may not be made from them which had been short assessed and short paid, together with the amount of additional tax and surcharge payable under section 34 of the Sales Tax Act, 1990. The matter was thereafter, dealt with by the Deputy Collector, who vide order, dated 8.7.1995, found the petitioners liable for payment of the said amount together with an additional amount of Rs. 10,705,755 and Rs. 4,389,387 on account of additional tax. The petitioners were also found liable for payment of one per cent surcharge.
2. On appeal before the Collector (Appeals), the said order was set aside and the case was remanded to the Deputy Collector for a fresh order. However, the matter subsequently went before the Additional Collector, who found the petitioners liable for the payment of the said amount, thus upholding the earlier order passed by the Deputy Collector.
3. The petitioners, according to Mr. Noor Muhammad, their leamed counsel, have filed appeal before the Collector, which is still pending for disposal before him.
4. The petitioners feel aggrieved because during the pendency of the appeal, they have received a notice for recovery of the said amount under section 48 of the Sales Tax Act.
5. The first contention of Mr. Noor Muhammad before us has been that, as the petitioners' appeal is still pending before the Collector, Customs and Central Excise, Hyderabad, and therefore, the amount sought to be recovered from the petitioners has not yet become due, as required by section 48 of the Sales Tax Act, 1990. His further contention has been that, although the order passed by the Deputy Collector, dated 8.7.1995, was set aside, on appeal, by the Collector, yet the Additional Collector, who heard the case after remand, found the petitioners liable for payment of the same amount, as was earlier found to be payable by the Deputy Collector.
6. We find no force in both the contentions of the leamed counsel. First of all, after remand of the case by the Collector (Appeals), the petitioners were found liable for the payment of the said amount and since up till now the said order occupies the field, the contention that the payment has not become due, is not tenable. No doubt, the petitioners' appeal is said to be pending for disposal before the Collector, but admittedly, neither the petitioners have sought stay in respect of the impugned order nor any stay has been granted by the Collector pending final disposal of the appeal. Learned counsel for the petitioners has argued that when an appeal is filed, the matter becomes sub judice and the original and the appellate proceedings are steps in one proceedings.
Support has been sought by him from the judgment of the Supreme Court in F.A. Khan v. The Government of Pakistan PLD 1964 SC 520, wherein such observations have been made by Kaikais, J., (as he then was). Support has also been sought by Mr. Noor Muhammad from Canada Motors Karachi v. Central Board of Revenue 1990 PTD 948 and M/s. Maple Leaf Cement Factory Limited v.
The Collector of Central Excise and Sales Tax 1993 M LD 1645, but the ratio respectively laid down in the said cases in no manner can advance the petitioners' case. It may be pointed out that the mere fact that the petitioners have filed an appeal before the Collector challenging the decision of the Additional Collector, the same cannot operate as automatic stay. Since, admittedly, the petitioners have not sought stay of the order passed by the Additional Collector, the order presently occupying the field is that of the latter. According to the said order, the petitioners are liable for payment of the said amount. Therefore, recovery can be made from the petitioners. As to the contention that filing of appeal amounts to continuation of the same proceedings, it would be sufficient to point out that after an order is passed in appeal, all other orders earlier passed would merge into the appellate order, but it is difficult to accept the contention of Mr. Noor Muhammad that without stay of the operation of the impugned order, the respondents are not authorised to recover the said amount from the petitioners.
7. As no other argument has been raised by Mr. Noor Muhammad, for the aforesaid reasons, the petition was dismissed by us in limine.