Commissioner Inland Revenue VS M/s Attock Refinery

ORDER SHEET

IN THE ISLAMABAD HIGH COURT, ISLAMABAD

JUDICIAL DEPARTMENT

S.T.R.No.13 of 2013 Commissioner Inland Revenue (Zone-I), LTU, Islamabad Versus M/s Attock Refinery Limited, Rawalpindi S. No. of order Date of order/ Order with signature of Judge and that of parties or counsel / proceedings Proceedings where necessary. 18.04.2022 Mr. Saeed Ahmad Zaidi, Advocate for the petitioner.

The questions of law proposed for our consideration are as follows:- “(i) Whether the imposition of default surcharge under section 34 of Sales Tax Act, 1990 is mandatory are otherwise when default on account of non payment of principal amount has been established against the taxpayer and upheld by the learned Appellate Tribunal Inland Revenue itself and the law also clearly provides for imposition of default surcharge irrespective of the fact whether the default is willful or not under section 34 of the Sales Tax Act, 1990.

(ii)Whether the imposition of penalty under section 33 of Sales Tax Act, 1990 is mandatory or otherwise when default on account of non payment of principal amount has been established against the taxpayer and upheld by the learned Appellate Tribunal Inland Revenue itself.”

2.Learned counsel for the petitioner submitted that it was obligatory on the Department to impose default surcharge and penalty and that the Appellate Tribunal Inland Revenue (“A.T.I.R.”) was not vested with any discretion to waive default surcharge and penalty.

3.The record shows that the learned A.T.I.R. had set-aside the order of the Deputy Commissioner Revenue (Audit-V) to the extent of imposition of default surcharge and penalty because of a letter written to the taxpayer by the Superintendent of Customs Department advising that sludge falls under PCT Heading 2713-9000. The taxpayer’s case before the learned A.T.I.R.

was that sludge falls under PCT Heading 2713- 9000 whereas the Department’s position was that sludge falls under PCT Heading 2710-9900. Since there was a letter from the Superintendent of Central Excise Department to the effect that sludge falls under PCT Heading 2713-9000, we do not find any infirmity or illegality in the order dated 17.11.2011 passed by the learned A.T.I.R. whereby the order dated 22.01.2011 passed by the Commissioner Inland Revenue (Appeals-I), Islamabad was modified to the extent of setting- aside the imposition of default surcharge and penalty. Therefore, the instant reference is answered in the negative.

(ARBAB MUHAMMAD TAHIR) (MIANGUL HASSAN AURANGZEB)

JUDGE JUDGE

Sultan*