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021113
GOVERNMENT OF PAKISTAN REVENUE DIVISION CENTRAL BOARD OF REVENUE
Sales Tax Ruling/ Instruction No. 68/2002
(SALES TAX WING)
C. No.3(62)STP/97(Pt-I)(Vol-V)
Islamabad, the 13th November,2002.
To:
The Collectors,
Sales Tax & Central Excise,
Peshawar, Lahore, Rawalpindi, Gujranwala,
(East) Karachi, (West) Karachi,.
The Collector,
Customs, Sales Tax & Central Excise,
Hyderabad, Multan, Quetta.
The Collector,
Collectorate of Sales Tax,
Faisalabad.
The Collector of Sales Tax,
Office of the Director General,
Large Taxpayers Units,
Karachi.
Subject:
APPLICATION OF SECTION 73 OF SALES TAX ACT, 1990.
I am directed to refer
to the Collectorate of Sales Tax & Central Excise, Lahore’s letter C.
No.02-Refund / N to Z/CBR/Misc/02/978, dated 05.11.2002 on the subject noted
above wherein it has been stated that the Board’s letter C. No.
3(36)STP/99(Pt-II), dated 28.12.2001 (copy enclosed) is contrary to the
provisions of section 73 of the Sales Tax Act, 1990 and therefore be withdrawn.
2. The matter has been re-examined in the Board. The contention of the
Collectorate has been found correct, as according to the provisions of section
73 of the act, the amount within 120 days of issuance of the invoice. Mere
issuance of cheque/draft in the name of seller does not fulfil the requirement
of section 73 ibid.
3. In view of the situation, the letter dated 28.12.2001 is hereby withdrawn.
The Collectorates are advised to verify actual transfer of payment from buyer’s
bank account to the seller’s bank account within 120 days as per provision of
section 73 of the Sales Tax Act, 1990.
(MANZOOR HUSSAIN MEMON)
Secretary (ST-L&P)
GOVERNMENT OF PAKISTAN REVENUE DIVISION CENTRAL BOARD OF REVENUE
(SALES TAX WING)
C. No.3(36)STP/99(Pt-II)
Islamabad, the 28th December,2001.
To:
The Collectors,
Collectorate of Sales Tax & Central Excise,
Lahore
Subject:
IMPLICATION OF SECTION 73 OF SALES TAX ACT.
I am directed to refer
to your letter C. No. IV A-ST (12) EST/04/2001/3457, dated 01.12.2001, on the
subject cited above and to say that the various issues and difficulties
concerning section 73 of the Sales Tax Act, 1990 are under consideration of the
Board and appropriate action will be taken in due course.
2. However, the Board is pleased to clarify that if a banking instrument has
been issued within 120 days but encashed later, input tax should not be denied.
Section 73 refer to “transfer” of the payment in favour of the seller from the
business account of the buyer” The section does not require deposit of the tax
in the supplier within 120 days. Thus, if a bank draft or a pay order is issued
within 120 days from the business account of the buyer in favour of the sellers,
input tax/refund will remain available irrespective of the fact whether the
amount was deposited. However, it must be ensured that the amount is ultimately
deposited in the seller’s account, and the cheque/bank/pay order is not
cancelled.
3. These instructions may be circulated to all concerned.
(DR. ASHFAQ AHMED TUNIO)
Secretary (ST-L&P)
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