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S.T.As. Nos. 49/KB and 50/KB of 1980‑81, decided on 27th May, 1986.

1951, R. 31‑‑Refund‑‑Imperative for assessee claiming refund under S. 27(1) of Act, 1951 to support its claim by a statement showing description, quantity and value of goods and tax paid in respect of them together with proof of payment of tax‑‑No evidence available on record of department to establish payment of amount of tax made by parties from whom assessee had made purchases of partly manufactured goods‑‑Sales Tax Officer, held, was justified in disallowing claim of refund for want of required information regarding payment of tax.

Muhammad Fareed, D.R. for Appellant.

Saeed Ahmad for Respondent.

Date of hearing: 27th May, 1986.

These are two departmental appeals concerning sales tax assessment years 1965‑66 and 1966‑67, are directed against the combined order of the Appellate Assistant Commissioner, 'C' Range. Karachi, whereby she directed the Sales Tax Officer to allow refund as claimed by the appellant on account of sales tax, and rehabilitation surcharge in the two years in question.

2. The assessee‑respondent is a public limited company. It manufactures goods which are liable to sales tax under the Sales Tax Act, 1951. It claimed, inter alia, refund of sales tax etc. on purchases of partly manufactured goods amounting to Rs.13,13,956 and Rs.34,64,560 respectively, for the two years under appeal as detailed below:‑‑

In compliance with the additions made by the Sales Tax Officer the assessee produced purchase vouchers of various parties from whom it had made purchases but in none of them the amount of tax paid on those goods on importation or on any previous sale, was mentioned. Since the proof of payment of tax was not available, the Sales Tax Officer disallowed the claims of refund of sales tax etc. in both the years. Aggrieved by his order the assessee went in appeal before the learned Appellate Assistant Commissioner who allowed the relief as stated above. Hence these second appeals at the instance of Revenue.

3. We have heard the representatives of both the parties and perused the orders of both the officers below as well as the details of the purchases made by the assessee‑respondent from quite large number of parties and we are convinced that the respondent has failed to comply with the terms of rule 31 of the Sales Tax Rules, 1951, which makes it imperative for an assessee who claims refund of tax under subsection (1) of section 27 of the Act to support its claim by a statement showing the description, quantity and value of the goods and the tax paid in respect of them, together with proof of payment of the tax. There is no iota of evidence available on departmental record to establish the payment of the amount of tax was made by the parties from whom the assessee had made purchases of the partly manufactured goods. In this view of the matter, the Sales Tax Officer was justified in disallowing the claim of refund for want of the required information regarding payment of tax at importation or from previous sales as laid down by section 27(1) of the Act and rule 31 of the Sales Tax Rules. The learned Appellate Assistant Commissioner, in our opinion, has fallen into an error in admitting the claims of the assessee for refund of sales tax when there was no proof of payment of sales tax either at importation or on any previous sale. In this view of the matter, there is no course open to us but to reverse the order of the learned Appellate Assistant Commissioner and restore those of the assessing Officer in respect of both the years in this behalf.

4. In the result, both the departmental appeals succeed and are allowed as indicated above.

M.B.A. Appeals allowed.

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