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Sales Tax Appeal No.847/LB of 2008, decided on 24th February, 2009.

----Ss. 21 & 46---Blacklisting a registered person---Appeal to Appellate Tribunal---Appellant enterprises were allegedly found involved in mere paper transaction, claiming input tax without backup invoices and issuing output invoices for refund or adjustment purpose---Record had proved that only the appellant had been held responsible for purchasing the saleable goods and that too from the registered persons who were neither suspicious nor false units at the time of transaction---Only the appellant had been blacklisted for the said transaction, while no action had been taken against the seller and no seller had been blacklisted on that ground---Department had not established that allegation levelled in the show-cause notice was beyond shadow of doubt---Benefit of doubt, how slightest it could be, would go to the accused---Department was not interested in defending the case, neither it had complied with the orders of the court for submitting the reply and para-wise comments; nor appeared on the final date of hearing---Impugned order was set aside. Muhammad Akram Nizami for Appellant. Nemo for Respondent.

This appeal is directed against Order-in-Appeal C.No.ST/BI.C/10607/24540, dated 26-10-2007, passed by the learned Collector (Appeals), Faisalabad. 2. Briefs facts giving rise to the filing of the present appeal is that) the AC (HQ) reported to the undersigned that during the physical verification of the declared business premises of Messrs Bismillah Enterprises, it was observed that there was not such any office. However, there was a godown of taps on which the name of the said unit was painted. 3. Moreover, as per computer" profile bearing a wholesaler of cotton sewing thread, the registered person has issued invoices amounting to Rs. 118.28 million involving output tax amounting to Rs.18.870 million with deposit of every meagre amount Rs.0.797 million which is 0.67% of total suppliers, w.e.f. date of registration (22-2-2001) to 07/2007, it has also been observed from data of invoice summaries that the registered person has claimed input tax invoices of blacklisted units i.e. Messrs Friends Traders, Fsd., Messrs I.W. Enterprises, Messrs China Impex, Fsd. (blacklisted), Messrs Silver Sense Company and Messrs Y.Q. Traders. It has also been reported that the registered person had also claimed input tax on invoices of those units which are non-filer, null filer and not charging output tax. It leads to the apprehension that Messrs Bismillah Enterprises, Faisalabad are involved in mere paper transactions, claiming input tax without backup invoices and issuing output invoices for refund or adjustment purpose. 4. I have heard learned counsel for the appellant and have gone through the relevant record placed before me. It has been argued on behalf of the appellant that all the documents including the audit reports have been produced but have not been taken into consideration. It is further argued that no supplier has been blacklisted and the order has no retrospective effect. It is also contended that the supplier of the transactions were neither blacklisted at the time and not were included in the suspected registered person. The learned counsel has relied on Customs General Order 3 of 2004 and Rule 32 of the Sales Tax Rules. He has stated that the appellant is not at fault and the order blacklisting of the appellant is harsh. He has further stated that no action has been taken against any supplier or purchaser and no unit has been declared fake or suspicious. No one appeared on behalf of the department. Even reply or parawise comments has been filed in the Court despite clear orders of the Tribunal dated 27-11-2008 passed in presence of Mr. Muhammad Afzal Auditor and even last opportunity was given to the respondent to file the same in presence of the representative of the department Mr. Ahmad Din and Mr. Shahid Pervaiz, Auditor. 5. I have heard learned counsel for the appellant and perused the record. It has been proved from the record that only the appellant has been held responsible for purchasing the saleable goods and that too from the registered persons who were neither suspicious nor fake unit at the time of transaction. It is also established that only the appellant has been blacklisted for the said transaction while no action has been taken against the seller and no seller has been blacklisted on this ground. It is astonishing that on the same allegation such harsh action has been taken by the department against the appellant but no action has been taken against the supplier which shows the pick and choose on the part of the department and discrimination which cannot be allowed. It is also contended that the audit of the unit has been completed and nothing has been proved against the unit. The documents desired by adjudication authority and availed by the appellant are on file at pages 51, 52 and 58 etc. have also not been discussed in the impugned order herein it has been established that the documents so required were produced by the appellant but have not been discussed in the impugned order. The nutshell of the above said discussion is that the department has not established the allegation levelled in the show-cause notice beyond any shadow of doubt and it is well-settled principle of law that the benefit of doubt how slightest it may be will go to the accused. The department is not interested in defending the case neither they have complied with the orders of the Court for submitting the reply and parawise comments nor they have appeared on the final date of hearing while the case was adjourned in presence of two representatives of department on 19-1-09. In the light of the above circumstances this appeal stands accepted and the impugned order is set aside. Parties be informed through registered post or by UMS. H.B.T./3/Tax (Trib.) Appeal accepted.

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